Find Your Niche Financial Advisory Market

Whether you're a veteran financial advisor with a long client list or a newbie looking to build your book, you might consider focusing your efforts on a particular niche. After all, people in search of a financial advisor look for someone compatible with them and alert to their objectives. If you choose your clients as carefully, you may find yourself performing at your most effective level.

You can begin by taking a close look at your current client base. It will show you how to hone in on the type of clients you want.

Sifting for Gold

First, print out a list of your clients and grab a few highlighters of various colors. We'll use green, yellow, and pink.

Now, slowly go down the list and stop at each name. Consider what it's like to work with each person.

Let's say the first client is a couple named Jones. They are pleasant, open to new ideas, and committed to following the plan you put together. When the markets take a tumble, they shrug off market volatility as just a part of long-term investing. They put away money each month. They've even referred a few friends to you. If all of your clients were like them, life would be peachy. Highlight this one green.

Next on your list is a couple named Lee. When they call, you reach for the antacids. They complain about your fees, how the neighbor makes more on their investments than Lee does, and how the person on the radio said your recommendations stink. Do you want more like Lee? Heck no! Highlight this one pink.

A number of other clients will likely fall somewhere between the Jones and Lees. Highlight these clients yellow.

Look for Common Traits

Now revisit the clients in the green group. Look for commonalities among these clients. For instance:

• Profession
• Generation X or baby boomer
• Business owner
• Family responsibilities

The possibilities are endless, and this is just the beginning. Next, you need to fine-tune your results.

Suppose that women aged 35 to 55 make up most of your green group. What do they have in common, besides gender identity? Some commonalities might be marital status, occupation, net worth, number of dependents. For example, let's say that most of your green group are single women who own their own companies.

That's a niche.

Once you've done this exercise with your green group, do the same with the yellow group. You might discover a few more clients who just need some of your time to become green clients.

Consider Client Concerns

Your next step will be to consider what financial concerns these clients share.

A few of them could be:

• Income volatility
• Healthcare costs
• Retirement income

To address these concerns you might offer products such as:

• Medical insurance
• Disability insurance
• Certificates of deposit (CDs)
• Traditional IRAs
• Simplified Employee Pension (SEP)
• Keogh plans

Clone Your Best Clients

Now that you know whom you enjoy working with, their common problems, and how to meet their needs, you'll want more people just like them.

One proactive approach is to find out what organizations they belong to, such as:

• Professional organizations
• Social clubs
• Charitable foundations

A good strategy is to become involved with these organizations. There are a number of ways to do this:

• Write articles for their newsletters. Most organizations have a monthly newsletter and their editors are almost always looking for interesting pieces that are relevant to their members. Be sure to include your contact number in the article and, if possible, a photo.
• Offer to speak. Program chairmen often need speakers. Let them know that you're available

Networking is a lot of work. However, you'll be meeting people who are your ideal clients.

What If I Have No Clients?

Suppose you're new to the business and have no clients at all.

No problem. You can determine your niche by using the same strategy. For example, what's your favorite hobby? Let's say you live and breathe golf and you know the golf pros at every course for miles around. These guys can pair you up for a round of golf with qualified prospects. What generally happens when you're riding around in a golf cart for three to four hours? Sooner or later the other person will ask: "What do you do for a living?"

Imagine how great it will feel like to have clients who are as passionate about the game as you are.

It won't happen overnight, but after people see you around the club, they'll feel like they know you and will be more likely to choose you when they need the help of a financial professional.