Welcome back to the 311th episode of the Financial Advisor Success Podcast!
My guest on today’s podcast is Terry Parham Jr. Terry is the CFO and Co-Founder of Innovative Wealth Building, an independent RIA based in California, Maryland that oversees nearly $330 million in assets under management for almost 900 client households.
What’s unique about Terry, though, is how, after nearly ‘failing’ out of the business because he was struggling to get new enough clients in his first 2 years, he changed his approach to asking for referrals by asking prospects upfront to commit to making a referral only after he showed them real financial planning value… and within 18 months his new approach had turned around his entire career to become one of the fastest-growing advisors at his entire company.
In this episode, we talk in-depth about Terry’s approach to gaining more referrals (and minimizing any need for other prospecting efforts) by asking clients to commit in their initial introductory meeting that they would provide him a referral in the future if they found his financial planning recommendations to be valuable… and then followed up after the financial plan was delivered, and the value was provided, with the referral request for them to follow through on their part. We also talk about how, after leaving a former firm (and his referral sources), Terry decided to rebuild his practice through hosting dinner seminars on Social Security and Medicare with a third-party marketing solution that would send out the mailers, provided the presentation materials, and was able to consistently get $3M to $5M of new AUM from each event at a net marketing cost of less than $2,000 per event, and why Terry took a lot of time to confer with colleagues and conduct research on what makes an advisory business successful before ultimately going independent to create the value he really wanted to be able to provide to his clients.
We also talk about how, early on in his career and on the verge of being fired, Terry realized he suffered from a lack of confidence and found that drawing for clients on a white board not only enhanced his ability to relay information and connect with his clients but also built his own confidence, why, despite winning multiple awards as a top producer, Terry decided to part ways with his former firm on principle and start over again because he didn’t like some of their corporate policies, and why Terry equates his transition to independence to the experience gained through dating, as by working for multiple firms over the first decade of his career he was able to learn what he liked and didn’t like, and was eventually able to realize when it was time for the next level of commitment (like moving from dating to marriage).
And be certain to listen to the end, where Terry shares the tension he felt when working at a large firm where he was expected to recommend “good enough” products and strategies when he really wanted to be in a position where he could truly say he was performing due diligence across all products to find the best solutions for his clients, why Terry believes that even though the financial services industry can be intimidating for newer advisors, it’s important to not focus on what others are doing and instead, leverage resources and put in the hard work necessary to earn your experience and learn what works for you, and why Terry believes that simply being a founder of an advisory business doesn’t mean he’s successful, as like raising a child, it is in continual hard work, mentorship, and improvement (even if it’s just incremental) that helps the business grow up to its full potential that really defines its success.
So, whether you’re interested in learning about why Terry never settled at his previous firms and eventually decided to launch his own firm, how Terry presented his value to prospective clients to gain referral commitments, or how Terry leveraged dinner seminars and third-party marketing teams to help him connect with more of the right types of clients, then we hope you enjoy this episode of the Financial Advisor Success podcast, with Terry Parham Jr.
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