February 1, 2016 • Russ Alan Prince , Brett Van Bortel
The affluent are certainly looking for the highest quality financial services. Investment management expertise is the reason they engage financial advisors. In many situations, the ability to obtain advanced planning services—wealth enhancement, estate planning, asset protection planning—is also a major draw.
While value-added services are not the principal reason the affluent will choose to work with or maintain their relationships with financial advisors, such services regularly prove to be very important in helping financial advisors solidify and strategically expand relationships with the affluent. This is especially the case with the ultra-wealthy.
By being the professional to whom the affluent turn to deal with their concerns, including those matters that are not financial in nature, they become the “go-to” professional. As such, their relationships can become especially strong, even mitigating periods of substandard investment performance.
Value-added services can be conceptualized in a number of ways. One very useful way to think about them is in the context of family offices. They fall under the umbrella of support services. Specifically, they are lifestyle services covering a range of specializations such as health care, family security, family education, philanthropy and advisory to name a few. Furthermore, there are also the special projects.
Two types of lifestyle services are most in demand by the wealthy. Usually topping the list is health care (often in the form of concierge medicine) followed closely by family security.
Concierge health care is regularly talked about as a singular service, but in reality there are many variations. Moreover, while there are many clear distinctions among the types of offerings today as the field of medicine continues to progress, it is more likely the differences will become fewer. For example, as mobile technology improves and the costs come down, tele-medicine options will multiply and may very well become standard components of all medical practices. Meanwhile, from the perspective of the wealthy, the following are a few of the high-demand concierge health-care capabilities:
• 24/7 immediate on-call physician: Quick access to a physician for timely diagnosis and immediate treatment saves lives and prevents acute problems from becoming critical.
• Second opinions: The ability to get second opinions for verification or for a different perspective is important to the greater majority of the ultra-wealthy.
• Complete case continuity: Having a qualified physician overseeing treatment across specialists can be both comforting and informative.
• Connected monitoring: With the adoption of smartphones and similar technologies, the ability of a physician to monitor a person’s health over long distances is becoming normal.
• Tele-diagnosis and treatment: Related to connected monitoring and often a cornerstone to 24/7 immediate on-call physicians is doctors’ ability to use mobile technology to evaluate and treat people.
Comprehensive longevity programs are increasingly in demand among the affluent. It is probably fair to say that most people would like to live a long, long time in very good health. This is increasingly possible for the wealthy, but it entails integrating wellness, medical care, cutting-edge solutions and financial planning. Being able to introduce this concept to affluent clients and prospects is not only a highly effective way to build relationships but is also, because of the clients’ need for specialized financial planning as part of the process, a very powerful way to integrate financial advisory expertise.
Family security is also very important to ultra-wealthy families. Their wealth and sometimes high profiles are magnetic for criminals. There is a range of services that family security firms provide, such as:
• Privacy and cyber protection.
• Personal protection services.
• Travel safety and security.
• Investigations and due diligence.
• Confidential litigation support.
The wealthy are increasingly becoming victims of extortion schemes by criminals threatening to expose inappropriate relationships, allegations of abuse, undesirable photographs, etc. The talented family security specialist will troubleshoot the issue and provide the best evidence he or she can gather through an investigation. Then alternatives can be considered. For example, specialists may ask whether it is lawful and ethical to purchase documents, photographs and recordings. Sometimes, the wealthy do not want to involve law enforcement. They just want the problem to go away. So the family security specialist selected must be very good at making such problems go away.