Top Advisors Service the Household – Not Just the Individual
Wealth management is about trust
At its core, wealth management is about trust. It is about giving an advisor control of your financial health and security and depending upon that advisor to make or recommend timely, well-informed decisions that help you meet your financial goals. When we at NexJ design the features that give our products an edge, we always focus on how specific functions can help advisors build more trust. This is what makes relationship hierarchies so important.
Book a 15-minute call with a wealth tech expert to see how relationship hierarchies help advisors build trust and serve the full household. We’ll share how hierarchies are increasing assets under management at firms just like yours.
While relationship hierarchies in corporate and investment banking may appear similar to those in wealth management, the distinction lies in intent. Corporate and investment banks may track multiple hierarchies for the same corporations, such as risk relationships versus legal relationships. This allows bankers to get a holistic view of what makes the most business sense for a client.
Wealth management, in contrast, needs a single, unified hierarchy because wealth managers focus on single households and extended households. Here, the objective is not structural insights, but personal understanding.
Building trust pays off. 94% of investors are likely to make a referral when they “highly trust” their advisor, per Vanguard.
So, how exactly do you make a hierarchy that specifically speaks to the needs of an advisor
Why relationship hierarchies matter in modern wealth management
Successful wealth management depends upon advisors building trust and making sure their clients have all the information they need to make the right decision to grow their wealth. To do this, advisors need to understand more than their customer; they have to understand the household, anticipating how family dynamics, shared assets, and individual goals all influence financial decisions.
NexJ CRM for Wealth Management is built around this ideal, with a relationship hierarchy that gives advisors a single view of the entire household — the financial status of a client, the client’s partner and other family members, their financial health, needs, and implications or events that have or can have an impact on their financial situation.
Hierarchies of this sort can be a key to expanding client relationships, for advisors who know how to use them. One very current use case is nurturing generational relationships to protect assets during wealth transfer.
Advisors report that they retain the relationship 74% of the time when the spouse inherits, but only 45% when their clients’ children inherit. Retention rates can be improved by building relationships of trust with the clients’ children early on, through initiatives like teen financial literacy seminars or newsletters.\
Hierarchies can also be used to uncover new sources of referrals. For example, if a high-net-worth client has a lawyer they like and trust with family business, a savvy advisor might build a relationship with that lawyer, opening up the possibility of mutual referrals between their client bases.
How NexJ brings relationship hierarchy hanagement to life for wealth managers
NexJ CRM offers advisors client and organization relationships in a hierarchical tree, allowing them to view details of the parent-child relationships in a household, along with relationships between other members. It lists all products or accounts for which the household has full or partial ownership.
Designed with advisor workflows in mind, the solutions includes a host of features engineered to enhance the view of a customer, from an advisor’s point of view. There is a flexible householding functionality, for example, to facilitate policy/account aggregation and modeling of complex relationships including referrals, family relationships, and ad-hoc relationships. A client or an account can be flagged as ‘primary’ to drive workflows or broadcast a specific account context over another.
In addition, advisors can define their own groups using categories and relationship custom fields, which enable them to view all members of a group using the relationship hierarchy. NexJ CRM for Wealth Management can automatically populate or update membership in groups based on information from integrated external systems (i.e., back office or marketing systems) and defined business rules.
Precision that will set your advisors apart
The NexJ Interaction Summary lets advisors roll up individual client notes to a household grouping level and maintain notes exclusively at a household level as well. Advisors can instantly view the whole history of their relationship with any selected contact, including scheduled phone calls, meetings, and other interactions since the beginning of the relationship, as well as all documents relevant to the relationship.
Having access to these different views of clients and their financial ecosystem helps advisors uncover hidden revenue, increase loyalty, and sell and serve better.
To create the best possible hierarchies, the NexJ team has extensive experience integrating with third-party systems that are sources of relationship and/or hierarchy data, ensuring your wealth managers will always operate with the most accurate and complete information possible.
To find out more about relationship hierarchies, and why they can empower your wealth management advisors to build trust and offer their clients advice that really works for them, book a quick consultation with us today.
