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12 Pro Tips For Smoothly Transitioning A Financial Client To A New Advisor

- January 28, 2021

Michael S. Schwartz, CFP®, AEP®

I apply a multidisciplinary approach to wealth management dovetailed with structured tax planning.

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Clients often develop strong bonds with their financial advisors because of the personal nature of the information they share. However, there may come a time when a longstanding advisor leaves the firm or retires, prompting a handoff of their clients to a colleague.

This can cause anxiety for clients, who may be wondering how to rebuild that same rapport and trust with a different advisor. To help, 12 members of Forbes Finance Council share their tips for smoothly transitioning long-time financial clients to a new advisor.

1. Learn what worked well with the previous advisor.

Choosing a new financial advisor represents a significant change for clients and can be stressful. One strategy an advisor can use to create a successful transition is to ask questions and fully understand what worked well with their prior advisor as well as what challenges existed. These responses provide guidance and an opportunity to personalize services and establish a positive transition. – Sharon Olson, Sharon Olson, CFP

2. Take this time to set expectations and address lingering issues.

It’s critically important for the client to get to know the advisor and the advisor to get to know the client. Further, the new advisor needs to know what the client has liked about the previous relationship and what was not ideal. A change is a good time to level-set, manage expectations and address any issues that have been lingering. – Michael S. Schwartz, Magnus Financial Group LLC

3. Share relevant client details within the firm’s CRM.

Data and client preferences should be logged within the company CRM instead of in each advisor’s head. Simply accessing account numbers and core information is not enough. The current and accepting advisor should also communicate internally as well as hold co-meetings with the client to ensure a successful transition. – Evan Kirkpatrick, Wendell Charles Financial

4. Match each client carefully with a new advisor.

A transition to a new advisor, even within the same firm, can be disruptive. To ease the process, consider who your client will work best with. Who has the best balance of technical and soft skills for your client’s needs? These relationships are built over time, so transitioning gradually is also key. Stay present for a while (even if only in the background). – Sonya Thadhani Mughal, Bailard, Inc.

5. Follow your succession plan.

Customer relationships trump marginal profits and savings differentials more often than not. If an investment firm wants to maintain a more predictable revenue stream, it must have solid succession planning. Its private bankers and financial planners should be required to have junior colleagues capable of managing the book of business so that clients will be more likely to remain with the firm. – James Hewitt, CEO, Advisor, Angel Investor

6. Ensure the client understands why this is happening.

The best way to transition a client internally to a different advisor is to set clear expectations about why this is happening. Clients always want to know that. It’s also important for the lead advisor to stay involved for at least one year, working with the new advisor to ensure the client is comfortable. This approach can create a more satisfying relationship for the client. – Brian Henderson, Whitnell

Forbes Finance Council is an invitation-only organization for executives in successful accounting, financial planning and wealth management firms. Do I qualify?

7. Stay in touch with the client during the transition.

Reassure the client that their needs will still be met, and show a history of the past resources that led to value for the client. Agree to stay in touch during the transition period and be highly responsive. Go to lunch or get together at a less casual place than the office to talk openly and address any of your client’s questions or concerns. – Dave Sackett, ULVAC Technologies, Inc.

8. Don’t rush the process.

You need to plan for a smooth transition. Much like passing the baton in a relay race, the handoff within the company needs to be deliberate and timed. It typically doesn’t need to happen very fast and could sometimes take a year or two. You want to ensure the new advisor is up and running before you completely let go and pass the client off to them. – Justin Goodbread, Heritage Investors

9. Let the client know the whole team is on their side.

Make sure your clients understand they have a whole team taking care of them, not just one person. Internally, cross-train and cross-communicate between your teams to keep your people informed. Also, have an adjunct on each account. They may have limited exposure, but the client will be familiar with them, which will help the transition. – Lori Moes, DJM Design CAD & Coordination Services Inc.

10. Introduce the new advisor as early as possible.

You may want to introduce the new advisor well in advance. Explain to the client that the news of the change is going to be followed by a seamless transition period during which their current advisor and their new advisor will both be working with them. This approach is associated with additional labor costs but is an effective way to reduce the churn rate during transition phases. – Dmitry Dolgorukov, HES FinTech

11. Always work as a team to serve clients.

When helping clients manage their finances, assign tasks and responsibilities to your junior advisors. Eventually, the junior advisors will form bonds with the clients, who will be happy to work with them because they have more than proven their competence. – Amir Eyal, Mylestone Plans LLC

12. Work closely with the new advisor to lay the right groundwork.

Ensuring the new advisor is prepared to manage the intricacies of each client’s situation lays the groundwork for less stress down the line. Competence and preparedness will ensure a smooth transition instead of a messy, conflict-ridden one. Take your time, do your diligence and don’t shy away from some extent of micromanagement earlier in the process rather than later. – Julio Gonzalez, Engineered Tax Services Inc.


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Asset class performance was measured using the following benchmarks: U.S. Large Cap Stocks: S&P 500 TR Index; U.S. Small & Micro Cap: Russell 2000 TR Index; Intl Dev Large Cap Stocks: MSCI EAFE GR Index; Emerging & Frontier Market Stocks: MSCI Emerging Markets GR Index; U.S. Intermediate-Term Muni Bonds: Bloomberg Barclays 1-10 (1-12 Yr) Muni Bond TR Index; U.S. Intermediate-Term Bonds: Bloomberg Barclays U.S. Aggregate Bond TR Index; U.S. High Yield Bonds: Bloomberg Barclays U.S. Corporate High Yield TR Index; U.S. Bank Loans: S&P/LSTA U.S. Leveraged Loan Index; Intl Developed Bonds: Bloomberg Barclays Global Aggregate ex-U.S. Index; Emerging & Frontier Market Bonds: JPMorgan EMBI Global Diversified TR Index; U.S. REITs: MSCI U.S. REIT GR Index, Ex U.S. Real Estate Securities: S&P Global Ex-U.S. Property TR Index; Commodity Futures: Bloomberg Commodity TR Index; Midstream Energy: Alerian MLP TR Index; Gold: LBMA Gold Price, U.S. 60/40: 60% S&P 500 TR Index; 40% Bloomberg Barclays U.S. Aggregate Bond TR Index; Global 60/40: 60% MSCI ACWI GR Index; 40% Bloomberg Barclays Global Aggregate Bond TR Index.