Now that the Midterms have finally come and gone, we will have more brain capacity and TV capacity to focus on other issues in our life. An October 26, 2018 episode of Hidden Brain entitled "Too Little, Too Much" shared some academic research on our limited brain capacity that can guide us. Freeing up the Midterm capacity will create mental capacity that will allow bloggers and investors the opportunity to focus on issues that impact our financial and emotional lives. This post will address what the wealth management industry can learn from successful midterm strategies without clouding our judgment by requiring we pick a side.
We are shocked and appalled by the billions spent on political campaigns. Let’s examine where the money was spent and examine where the strategies worked.
The financial crisis created brand backlash against Wall Street. This backlash opened the door for independent advisory firms to position themselves as the anti-Wall Street and helped them grow their clientele and assets significantly. Unfortunately that hatred dissipated forcing the independent firms to adjust their positioning. Wall Street also adjusted their positioning by toning down their rhetoric to be more client friendly. Donald Trump rode a similar discontent with the political establishment to the Presidency. Unfortunately that discontent has dissipated too. What is the political and wealth management message now? The midterm results show that the political establishment has heard the voters. The slowing asset growth of independent wealth management firms deserves a similar response. Social media and in person visits can help.
The other lesson learned in the midterms was that local trumps national (pun intended). In wealth management Wall Street is easy to hate but a humble and knowledgeable advisor can trump the thundering herd (pun intended). We believe that the independent advisory industry goal of creating a national brand is a fool’s errand. The advisor you know and trust from the neighborhood feels like a safer choice. Entrepreneurial and political advice shares the belief that a local network built through community involvement is time well spent.
We have a fixation with the new generation. We do not understand them but politicians and wealth advisors need their votes and assets. Millennials unfortunately don’t trust their parent’s financial advisors and political parties. Our solution is to get to know each other, you might be surprised by how much you have in common. Millennial votes helped win the Midterms and their assets will help wealth advisory firms win the next stage of their business growth.
If you voted, thank you, if you didn’t vote use your new bandwidth to do some good.