How Financial Planners can get High Quality Referrals

While every professional welcomes referrals, a recent study by Charles Schwab found that getting them can have a sizable influence on the growth of your business. Referrals can provide 60% of a firm’s new business.

Charles Paikert, one of Financial Planning’s senior editors, wrote a recent piece on the dos and don’ts of getting high quality referrals.

Financial planners particularly seek people who are “centers of influence,” i.e. professional attorneys, accountants, business leaders, and other planners with different specialties. But how to go about getting such high-quality referrals?

Schwab’s Managing Director of their business consulting services—Nikolee Turner—critiques misperceptions that can hurt your effort to get such referrals:

  • Referrals are not reciprocal
  • Personal relationships do not equal professional relationships
  • Don’t think of lunch as a strategy
  • More relationships is not necessarily better (lack of focus)
  • Your value may not be obvious

Turner proposed ways to develop an effective strategy to land COIs at a breakout session at a Schwab Impact conference. First of all, obtaining such a referral is a long-term undertaking. More than 60% of the high-performing firms surveyed worked with a COI for a year or more before the person provided a referral.

Keep in mind what a COI looks for in an adviser:

  • Being trustworthy and objective
  • Putting clients first
  • Doing good work
  • Being transparent and simple
  • Respecting the gatekeeper

Turner advised finding a professional that you can grow with—and that you should treat them like you do your best clients.

Once you think you have built rapport with someone you perceive as a suitable COI, set up a meeting at their office. Not lunch! Ask questions about their concerns, needs, and business…and listen.