Krista Kerr, CEO of Kerr Financial Group, offers tips for reining in overly-eager clients.
It was way back in the 1970s that Krista Kerr’s father, then working at the old Coopers Lybrand, realized there was a new industry emerging in Canada. Like many working in the large firms at that time he realized there was a new niche opening up around personal financial advisory services. He took his strong knowledge of taxes and estate management, left the big firm, became one of the original personal financial advisors.
“He felt there was a gap on tax estate planning. He didn’t know there was a name for those who worked with individual families who helped with estate planning strategies,” says his daughter Krista.
Since then Kerr Financial has generated an extremely solid reputation managing the money, estate and tax issues for a relatively small group of well-off families. Today, Krista is the CEO. She recently talked to Wealth Professional about how to manage expectations of clients who want to spend beyond their means.
“You’ve got to extract the bigger picture for the client,” says Kerr. “If someone wants to take the bigger trip, buy a bigger house. You’ve got to bring them back to the big picture.
This is one of the most basic challenges of the modern advisor: The client wants to spend outside of their means on a bigger boat, vacation or another home. To the client, it only makes sense to spend now—what are you waiting for? For the advisor there is a dedicated plan that needs to be followed. Balancing client demands into touch with reality is the basic challenge every professional advisor faces.
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Getting the balance right is a matter of being diplomatic, rational and accommodating. “I would rarely say, ‘You can’t do that.’ Rather, I might say, ‘if you do this, it will make it harder to do this’…You want to point out where they will have to cut spending in other areas to keep them on track for their financial goals. Keep bringing them back to the big picture. Point out how they will be in a better situation down the road,” says Kerr.
She should know. She’s had a long time to learn from her father. Krista began her career at Ernst & Young as an audit manager and consultant. But in 1993 she joined the family firm. Originally based in Montreal the firm expanded to Toronto and now employs thirty people. Today Kerr leads the quarterly Kerr Financial partners’ meetings, is a member of the firm’s Investment Committee and remains active in developing new business. She also leads the firm’s Multi-Family Office division, which provides integrated planning services to sophisticated high net worth families largely made up of business owners, senior corporate executives and individual investors. She also serves as a member of the Board of the National Ballet of Canada and the National Ballet of Canada Endowment Foundation and Chair of the Patron’s Council Committee of the National Ballet of Canada. She also edited a publication, The Only Retirement Guide You’ll Ever Need. That is, she’s a pro. She understands goals and what it takes to client expectations and needs for the very long-term.
“You have to understand the other things clients want to do. You bring it up. But you have to point out an array of scenarios. Use simulator tools and financial planner software. Help the client understand the impact to long-term cash flow that will follow from their decisions. Bring up these projections on software. Show them where the impact will be and how the big picture will change. Point out the deficits. Keep revisiting and managing the generational goals and assumptions. That’s the key.”
“He felt there was a gap on tax estate planning. He didn’t know there was a name for those who worked with individual families who helped with estate planning strategies,” says his daughter Krista.
Since then Kerr Financial has generated an extremely solid reputation managing the money, estate and tax issues for a relatively small group of well-off families. Today, Krista is the CEO. She recently talked to Wealth Professional about how to manage expectations of clients who want to spend beyond their means.
“You’ve got to extract the bigger picture for the client,” says Kerr. “If someone wants to take the bigger trip, buy a bigger house. You’ve got to bring them back to the big picture.
This is one of the most basic challenges of the modern advisor: The client wants to spend outside of their means on a bigger boat, vacation or another home. To the client, it only makes sense to spend now—what are you waiting for? For the advisor there is a dedicated plan that needs to be followed. Balancing client demands into touch with reality is the basic challenge every professional advisor faces.
#pb#
Getting the balance right is a matter of being diplomatic, rational and accommodating. “I would rarely say, ‘You can’t do that.’ Rather, I might say, ‘if you do this, it will make it harder to do this’…You want to point out where they will have to cut spending in other areas to keep them on track for their financial goals. Keep bringing them back to the big picture. Point out how they will be in a better situation down the road,” says Kerr.
She should know. She’s had a long time to learn from her father. Krista began her career at Ernst & Young as an audit manager and consultant. But in 1993 she joined the family firm. Originally based in Montreal the firm expanded to Toronto and now employs thirty people. Today Kerr leads the quarterly Kerr Financial partners’ meetings, is a member of the firm’s Investment Committee and remains active in developing new business. She also leads the firm’s Multi-Family Office division, which provides integrated planning services to sophisticated high net worth families largely made up of business owners, senior corporate executives and individual investors. She also serves as a member of the Board of the National Ballet of Canada and the National Ballet of Canada Endowment Foundation and Chair of the Patron’s Council Committee of the National Ballet of Canada. She also edited a publication, The Only Retirement Guide You’ll Ever Need. That is, she’s a pro. She understands goals and what it takes to client expectations and needs for the very long-term.
“You have to understand the other things clients want to do. You bring it up. But you have to point out an array of scenarios. Use simulator tools and financial planner software. Help the client understand the impact to long-term cash flow that will follow from their decisions. Bring up these projections on software. Show them where the impact will be and how the big picture will change. Point out the deficits. Keep revisiting and managing the generational goals and assumptions. That’s the key.”
