Assessing Investable Capital: A Necessary Part of Financial Advisory

One of the first questions I need to ask any potential client is, “What’s your investable capital?” This question is essential because, in my role as a financial adviser, I have to ensure that the time I invest in a client will be mutually beneficial. Unfortunately, this sometimes means turning away people who genuinely seek my advice but may not meet the financial thresholds necessary for the services I provide.

For example, I was recently introduced to the younger brother of one of my existing clients. His brother, who has several million invested with me, recommended my services. The younger brother was eager to get my advice, but after our initial conversation, it became clear that his investable capital wasn’t at the level required for the personalized, in-depth financial management that I offer. As a result, I had to make the difficult decision to decline the meeting.

However, I always aim to help in any way I can. I have a broad network of contacts within the industry, and I’m able to refer clients who may not meet my criteria to other advisers who are well-suited to their needs. These professionals are more than willing to work with clients at different financial levels and can provide high-quality advice tailored to their specific circumstances.

Why Investable Capital Matters

In the world of financial advisory, the amount of investable capital a client has is a key factor in determining the level and type of service that can be provided. High-net-worth individuals often require more complex financial planning, including tax optimization, estate planning, and investment management across multiple asset classes. These services are time-intensive and require a deep understanding of the client’s financial situation and goals.

When a potential client’s investable capital is below a certain threshold, it can be challenging to provide the same level of personalized service while ensuring that the advice remains cost-effective for both parties. This is why understanding a client’s financial capacity early on is crucial for determining the most appropriate advisory relationship.

Providing the Right Solution

While it’s never easy to turn someone away, my goal is always to ensure that each client receives the best possible advice tailored to their needs. By connecting potential clients with trusted colleagues in the industry who are better suited to their financial situation, I ensure that they still receive the guidance they need to make informed decisions about their money.

Conclusion: Matching Clients with the Right Advice

In financial advisory, it’s important to match clients with the right level of service to meet their needs effectively. By asking the right questions upfront, such as “What’s your investable capital?” I can ensure that my clients receive the personalized, high-level service they expect, while also helping those who may not meet my criteria find the right adviser for their situation.

If you’re looking for financial advice and wondering whether my services are a good fit for you, feel free to reach out. If we’re not the right match, I’m happy to connect you with someone who can provide the guidance you need.