How to start the cash conversation with clients

The Cash Opportunity for Advisors continues. After taking a look at what held-away cash is, why clients hold it, and the benefits of a cash management solution, the series continues with a tactical approach to rolling out the solution to clients. We walk you through why it should be a topic of discussion with each and every client, and how to have the conversation with current, new, and prospective clients on a recurring basis. 

Why every client needs a cash solution

Industry research has shown that clients hold a significant portion of their assets in cash – often much more than advisors recommend, or even know about. Advisors who embrace this fact can offer their clients actionable steps to improve their financial well-being while bringing new assets into their orbit.

However, cash solutions are not just for the exceptional client holding an exceptional amount of cash in their checking account. “Often, when we tell advisors about Flourish Cash,^† they respond, ‘This will be perfect for my clients who hold a lot of cash’”, said Flourish President Ben Cruikshank. “But it’s not just for one client. Every single client has cash in a checking or savings account and might be excited to earn more, whether they have $100 or $100,000.” With the national savings account average at 0.45% APY in October 2024,^# every single client may benefit from a more profitable place to put cash reserves that they want to remain liquid.

The most successful advisors bring up cash with every client on a regular basis – all it takes is a few simple questions. Based on success stories from advisors, here is a plan for how to get started.

Starting the conversation: Existing clients

Many advisors haven’t checked in on client cash holdings since the initial planning conversation at the start of the advisory relationship. Go beyond the clients that you assume hold a lot of cash. Even clients with small amounts of cash are often excited to have a high-interest option, while other clients may have far more cash than you think. 

Instead of an ad hoc approach, successful advisors typically make a plan of bringing up cash with every client during regularly scheduled quarterly meetings. It’s easy to start the conversation with a few basic questions:

• How much cash are you holding?
• Why are you holding cash?
• Where are you holding cash?
• Do you know the rate you are earning?

“RIAs that use Flourish Cash typically present it as a solution that’s exclusively available to the clients of independent advisors,” said Cruikshank. They describe the benefits: it allows clients to earn a competitive rate, retain liquidity, and benefit from increased FDIC insurance through our Program Banks.^Ω Additionally, it’s an option that’s integrated with the firm, allowing advisors to offer more holistic advice.

Finally, most advisors share a branded factsheet and let them know that they will be receiving an invitation soon. “It’s something that we bring up with every client to make them aware. It’s a standing agenda item and it shows that we’re on top of things,” said Erica Bouchard, Wealth Advisor at Buckingham Strategic Wealth. "It’s nice to be able to offer something new when you’re meeting with a client. We’re always striving to show clients the value that we’re adding.”

Starting the conversation: New and prospective clients

For clients who are new to your firm, advisors have the opportunity to add more value at the start of the relationship. “Working with a new advisory firm starts out with inspirational, fun conversations. Then it’s a month of paperwork, questionnaires, and process before clients really start to benefit,” said Cruikshank. Presenting clients with a new tool that shows returns quickly can help ease clients through the introductory phase. Flourish Cash makes it simple to set up standing instructions with your custodian, yielding operational efficiencies. 

For prospects, it’s a rare opportunity to deliver value before an advisory agreement has been signed. Flourish Cash gives advisors a reason to call down the list of prospects they may have been courting for years. Advisors can ask prospective clients similar questions to what they’d ask current and new clients, diving deeper into the emotional side to understand if they are fearful, if they are hesitant to enter the market, or if there are other considerations preventing them from taking action. 

Even better, when a prospective client signs up with Flourish, your firm will stay top of mind as they see your firm’s name and logo across the website, emails, and print materials. 

Making it actionable and recurring

Finances are emotionally charged and cash is no exception. Recognize that some clients might be embarrassed about the amount of cash that they’re holding. Conveying excitement about an exclusive new solution can be an effective way to open the conversation without putting clients on the spot. 

Firms that are successful with offering clients a cash solution make it an actionable and recurring topic of conversation with each and every client. These advisors welcome the opportunity to support clients in even more aspects of their financial life. “Go beyond the clients you know hold cash. Planning and growth-oriented firms ensure that every client is in a good place, whether at Flourish or somewhere else,” said Cruikshank. "Particularly given recent events in the banking industry, this is an opportunity to bring cash into the conversation and make sure every client is happy.”