Many advisors have a strong desire to move “up market” to deal with the high net worth (HNW) client. Countless marketing dollars are spent on understanding this demographic and their needs, yet most advisors are unsuccessful in engaging the HNW population. Getting the attention of the HNW may require different tactics, specialized knowledge and new skills. Yet, most advisors stick with the same, stale messaging that they’ve used to establish their mid-market base. Perhaps it’s time to try a different approach.
HNW clients have different needs and many own different and unique assets that need to be planned for. It is estimated that 30% of families that have a net worth in excess of $10 million “collect” something: art, automobiles, antiques, stamps, jewelry, rare coins are among the most popular of the countless categories of collectibles. Often the collections comprise more than 10% of the total estate and some go as high as 30% of estate value. However, these valuable and meaningful assets are usually completely ignored by the professional planning community who serve this population. Even though the client may be totally passionate about the collection he has accumulated over many years, if none of the professionals bothers to uncover the desire for the distribution of the collection at the client’s death, the result for the collectors and their families can be disastrous.
Collectibles are assets. The HNW collector usually doesn’t think of them as such. Like all other assets, they need to be carefully planned for. As a class of assets, collectibles require even more special attention than other asset classes for many reasons. They aren’t traded on public exchanges so therefore aren’t necessarily liquid when they need to be. They require specialized knowledge and specialized handling. They are often not well organized or catalogued; are frequently uninsured or underinsured; are often titled ineffectively; frequently expensive to maintain; and seldom appreciated or desired by the heirs.
For all these reasons and more, the advisor who understands the importance of discussing these assets with the HNW client will have a distinctive edge over his competitors. The opportunity to win the trust of the HNW family by helping through the many steps and decisions necessary for the proper disposition of their often most important possessions can be the key to building log term and meaningful business success.