Investment advisors must give their clients quarterly performance reports, right? Just because we think everyone else does it, does that mean we need to also? Believe it or not, some advisors only provide clients with performance reports annually and some don’t provide them at all!
As CEO of Total Rebalance Expert®, I come in contact with many advisors. I was surprised to find out that some of them did not submit performance reports to clients. When I asked them about it, they gave me the following responses:
Think about it. We don’t want our clients to focus on short-term returns. In fact, we’d rather they not focus on returns at all. We’d like our clients to be thinking about accomplishing their long-term goals. If we are truly wealth managers, then why does our reporting emphasize performance?
In my RIA firm, I’ve always given my clients quarterly performance reports. I don’t think I could stop doing so mid-stream. But, what if the move was gradual?
For example, what if, in addition to performance figures, I also added the following to my reports?
I could then gradually move performance reporting to the back page, eventually deleting such reporting altogether.
Is this a radical idea? Or is it more in line with the services we want to be known for?