Log in to access resources reserved for MDRT members.
  • Learn
  • >
  • How to tailor financial advice to fit the unique needs and goals of your clients
How to tailor financial advice to fit the unique needs and goals of your clients [Merryl Baptista]
How to tailor financial advice to fit the unique needs and goals of your clients [Merryl Baptista]

Apr 19 2024

How to tailor financial advice to fit the unique needs and goals of your clients

Merryl Baptista, an MDRT member with a year of seasoned expertise from India,  elucidates the key challenges and strategies involved, emphasizing the importance of understanding clients' financial desires, risk tolerance, and long-term goals.

Topics Covered

Beyond creating strategies that look at clients’ financial circumstances and goals, and offering a personal approach, how can financial advisors customize financial advice to align with customers’ and individuals’ needs and aspirations? Merryl Baptista, an MDRT member for one year from Mumbai, India, discusses the key issues and challenges involved in this process and enumerates the roadmap that a financial advisor can offer clients for a secure future.  

He explains that the task of a financial advisor begins with discussing the clients’ aspirations and end goals. The advisor should understand the client’s profound financial desires and create viable paths to achieve those goals. The advisors need to be empathetic and a good listener. Baptista says, “As an advisor, one should sit with the client, attentively listen to their thoughts and needs, and appropriately ask questions that will enable them to open up about their aspirations and objectives, not only for themselves but also for their family. It is crucial to become familiar with their lifestyle and understand their future plans. By understanding client’s attitudes towards risk and financial decision-making, advisors can tailor their approach.”  

According to him, the financial advisor should create a client persona that fits them perfectly, like a custom-made suit, to approach this issue. They should analyze income, expenses, investment horizon, and risk tolerance. It is imperative. Factors such as investment horizon and risk-taking ability are vital in deciding the best plans. Baptista shares an anecdote, “A young client approached me with the intention of increasing his portfolio returns and aiming to achieve a good financial life. I structured the portfolio to ensure that he can access his funds as needed. Today, he is delighted with the consistent inflow of money, enabling him to enjoy his earnings while simultaneously fostering growth through reinvestment of the remaining amount.”  

The client, a young individual, approached Baptista seeking to increase portfolio returns while maintaining liquidity to support his lifestyle and financial goals. Recognizing the client's dual objectives of growth and accessibility, Baptista conducted a thorough assessment of the client's financial situation, risk tolerance, and long-term objectives. Based on his analysis, Baptista devised a customized portfolio strategy that balanced the client's desire for growth with the need for liquidity. He allocated a portion of the portfolio to investments with potential for high returns, while ensuring another portion remained readily accessible for the client's immediate needs. 

Baptista's decision to structure the portfolio in this manner stemmed from a combination of financial expertise, market analysis, and a deep understanding of the client's individual circumstances. He carefully evaluated various investment options, considering factors such as risk levels, liquidity requirements, and investment time horizon. 

Throughout the process, Baptista maintained open communication with the client, explaining the rationale behind his recommendations and addressing any concerns or questions the client had. While the client may have initially been apprehensive about committing to the proposed strategy, Baptista's clear explanations and personalized approach instilled confidence and trust in the client. As a result of Baptista's tailored portfolio structure, the client experienced consistent inflows of money while enjoying the flexibility to access funds as needed. This approach not only met the client's immediate objectives but also set the foundation for long-term financial growth and stability. Today, the client is delighted with the results, as the portfolio continues to generate returns while supporting his lifestyle and future aspirations. 

Baptista believes financial advisors must continuously monitor and adjust financial plans based on client needs and inputs. Regular reviews ensure that the financial plan stays on track, adapting to changes in life circumstances or market conditions. 

He also believes it is crucial to communicate openly and frequently. He says, “When meeting with the client to discuss his financial strategy, provide him with a visualization of your suggestions and how they will help him achieve the goals he has shared with you. Pay attention to even the smallest details he has mentioned, as this will help build trust in your advice. When the client sees that you have considered his needs and provided a solution, it fosters confidence and trust in your relationship.” 

He explains this further with an example, “Consider a scenario where the client discusses plans for his child’s higher education and marriage settlement. In the conversation, he casually mentions his love for traveling. Keeping this in mind, prepare a plan that not only addresses his child’s financial needs but also provides extra funds beyond returns to fulfill his travel goals. This personalized approach makes it easier to guide the client through the investment plan. He will more readily follow the advice, understanding that the plan is tailored exclusively to meet his needs and promote his financial growth.” 

Clients often expect guaranteed high returns in the short term, leading to the creation of a customized plan with short-term goals. Some advisors might advocate keeping clients invested in a single company, exposing them to new ventures promoted through glossy advertisements, even if they may not be in the clients’ best interest. To navigate this, Baptista shares that advisors need to stay updated on the latest technology as well as market news, simultaneously keeping clients informed about their diverse investments and the benefits derived from them. This approach builds and sustains the trust that clients place in their advisors, allowing for smoother acceptance of advice, especially when changes are needed due to evolving financial rules or altered circumstances.  

Baptista believes the advisor-client relationship is a long-term journey that requires ongoing maintenance and nurturing until the client’s objectives are achieved and desired goals are realized. 


Contact: MDRTeditorial@teamlewis.com