Three insurance company presidents recently bemoaned the fact that no one was working in the middle-income markets anymore. Now they want you back where the people are. It would have been more compelling if it weren’t the companies themselves that pushed advisors away from the middle and to the HNW market in the first place.
I get the attraction. It’s the Willy Sutton, Bank Robber rationale: “That’s where the money is.” Still, it’s not the easiest place to make a living unless those people are your natural audience. If they aren’t, you’ll be working hard and long for your money. “Big-case-itis” is alive and well.
Late industry icon John Savage said it this way. “If you work with the classes, you’ll live with the masses. If you work with the masses, you’ll live with the classes.” John believed there is more work and more money working with regular people – middle-income earners.
Regular people need help today more than ever. Every segment of financial advice is more complicated. Many people are lost and have nowhere to turn. And, there are many more of them out there. Targeting the top 5% of income earners still leaves nine times more in the top half. Can you make a living helping them make their lives better? You bet.
I consult with an advisor who now works only with retiring utility workers in his area. While they are just regular folks, it turns out their company pensions are worth more than a quarter of a million when they retire. And, they are retiring in droves without any help. So, he makes millions helping hundreds with their thousands.
He used to chase big fish but the chase never ended. As he says, now that he’s focused on this group, “the fish are chasing the boat”.
Why? Because they need him. He knows his stuff cold (actually their stuff, so he is their expert) and treats them like gold. They appreciate it and reward him by helping attract new business like crazy. It’s easier, more rewarding and very profitable.
Here’s the thing. Your audience knows what they want from you. They tell you all the time. If you listen carefully and act accordingly, you’ll know if HNW is the place for you. It really depends on you, your expertise and connections. In the end, you have to decide whether you want the prestige of that business label more than the income from helping those who need it most. If your decision is ego or pride driven, you’ll be wrong.