Overcoming Referral (Asking) Reluctance And The Risks Of Marketing Yourself: Kitces & Carl

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Kitces and Carl Podcast for Financial Advisors

Over the past several years, there’s been an explosion in the number of marketing channels that advisory firms can use to attract new leads, turn them into prospects, and finally convert them into clients or customers. Yet, despite the ongoing evolution in marketing, our Kitces Research studies have shown that the most common way that financial advisors gain clients is the same way they’ve been doing it for decades… through referrals. As the profession has evolved, however, so too has the approach to actually generating those referrals, as the invasive “I get paid two ways” tactic has been replaced by having far more effective (and far less uncomfortable!) conversations with existing clients about ways in which they would prefer to connect with new people.

Unfortunately, though, many advisors still have a difficult time actually starting up those referral-asking conversations in the first place, which, in turn, raises the questions: What are the blocking points keeping advisors from having conversations with their existing clients about finding more clients like them, and how can we as advisors overcome those blocking points?

In our 50th episode of Kitces & Carl, Michael Kitces and client communication expert Carl Richards discuss the underlying reason why advisors have such a hard time asking their clients for referrals, how to push forward by instead asking advice on how to grow their practices, and ways to gain the sort of confidence that ultimately eliminate those blocking points altogether.

As a starting point, it’s important to recognize that anything having to do with marketing and business development requires an advisor to put themselves “out there”, which means that there’s a risk of rejection. And since human beings don’t like rejection, it’s that fear of rejection that causes us to find all sorts of reasons to not do what it is that we’re supposed to do. Overcoming that fear initially often requires a burst of courage to take a leap and take action, but the good news is that those leaps not only get easier with repetition, they eventually become something to look forward to as the advisor starts to see tangible results from their efforts and feels “rewarded” for taking the leap.

From there, the next important step is for advisors to gain the confidence that the services they offer really do bring value – so much value to their clients, that they should want to be passionately telling (nearly) everyone they meet about the great work they do! There’s a plethora of pathways towards gaining that passion and confidence, but two of the most important for advisors are by making sure they are in a situation where they are proud of what they do and the services they can offer, and by obtaining the education necessary to have the self-confidence of knowing that they are good at what they do and that they help people.

The key point is that the challenge around generating referrals from existing clients is less about the method itself, and more about overcoming the fear of rejection, and addressing our own self-confidence gaps that may exist. Because at the end of the day, it can be helpful to reflect on the fact that most of the good things that happen in life involve some initial element of risk. Ultimately, soliciting a client’s help in meeting more prospective clients that are like them isn’t about generating referrals or having conversations about referrals, but is simply a way for advisors to try get more people great financial advice that they’re confident they can provide!





Michael Kitces is Head of Planning Strategy at Buckingham Wealth Partners, a turnkey wealth management services provider supporting thousands of independent financial advisors.

In addition, he is a co-founder of the XY Planning NetworkAdvicePayfpPathfinder, and New Planner Recruiting, the former Practitioner Editor of the Journal of Financial Planning, the host of the Financial Advisor Success podcast, and the publisher of the popular financial planning industry blog Nerd’s Eye View through his website Kitces.com, dedicated to advancing knowledge in financial planning. In 2010, Michael was recognized with one of the FPA’s “Heart of Financial Planning” awards for his dedication and work in advancing the profession.





Carl Richards is a Certified Financial Planner™ and creator of the Sketch Guy column, appearing weekly in the New York Times since 2010.

Carl has also been featured on Marketplace Money, Oprah.com, and Forbes.com. In addition, Carl has become a frequent keynote speaker at financial planning conferences and visual learning events around the world.

Through his simple sketches, Carl makes complex financial concepts easy to understand. His sketches also serve as the foundation for his two books, The One-Page Financial Plan: A Simple Way to Be Smart About Your Money and The Behavior Gap: Simple Ways to Stop Doing Dumb Things with Money (Portfolio/Penguin).




This podcast first appeared on the Nerd’s Eye View at Kitces.com at https://www.kitces.com/blog/referrals-conversations-reluctance-fear-confidence-education-courage/  and has been reprinted here with permission.

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