While maintaining privacy about a person’s financial affairs is obviously required by all advisors, this is especially important in a smaller centre where people are likely to be connected to each other in some way.EricFerguson/iStockPhoto / Getty Images
Sign up for the Globe Advisor weekly newsletter for professional financial advisors on our newsletter sign-up page. Get exclusive investment industry news and insights, the week’s top headlines, and what you and your clients need to know.
Michael Thor often runs into his clients at local community events, among other places. That’s no surprise to some on The Globe and Mail and SHOOK Research’s Canada’s Top Wealth Advisors: Best in Province ranking who live and work in a rural or smaller municipality. They cross paths with clients at grocery stores, on hiking trails, everywhere, really. It means advisors must always put their best foot forward and maintain discretion.
“A good advisor is a good advisor regardless of where you live. But [in a small town], you’re more highly accountable because you are visible in the community,” says Mr. Thor, investment advisor with Thor Wealth Management Group at TD Wealth Private Investment Advice in Midland, Ont.
Anna Hilberry, who along with her father, has advised clients in Duncan, B.C. (population just under 5,000) and surrounding communities for the past three decades, puts it even more strongly.
“Everybody knows everybody here, so there are not a lot of secrets in a small community. You can’t be one person by day and another at night,” says Ms. Hilberry, wealth advisor and portfolio manager with The Hilberry Group Wealth Management at National Bank Financial Wealth Management.
“You must lead by example. Your reputation is very visible in a smaller community.”
Ms. Hilberry gained all new clients from word of mouth and has a YouTube channel with several financial literacy videos. She attributes referrals to a good reputation, the family’s charitable initiatives, and being known in the community – if not directly by the prospective client, but by people they have in common.
She says most of her clients have “first-generation wealth,” which is wealth built on their own, not through family inheritances. These clients seem to appreciate working with people who come from building wealth similarly, with humble beginnings and hard work.
Ms. Hilberry was also born, raised, and still lives among her clients in rural Vancouver Island, something that she believes is comforting to clients.
Growing a business in a small town
Mr. Thor, on the other hand, didn’t grow up in Midland, which has a population of more than 17,000. He was born and raised in the Ottawa region, then moved to Georgian Bay, Ont. to build his career within the full-service brokerage industry. After starting out at a major Canadian bank, he was offered a position in a brokerage firm and once he toured Midland in 1994, he fell in love with the scenic landscape and never looked back.
He recalls the advice of a mentor – that the process of building a practice is a marathon – not a sprint. He knew one person from the town, formed acquaintances and friendships, became involved within the community, and grew from there.
One mistake the industry makes is equating small populations with not a lot of client assets to manage.
“When I first moved to Midland, there was no brokerage firm here,” Mr. Thor says. “Typically, advisors were from larger centres like Toronto. There was a lot of wealth in those areas and nobody really served them. Over the years, we’ve seen people leave the city, move to their cottage, and make that their permanent home.”
He saw the opportunity to build a practice and says it’s been slow and steady, but has grown to be successful.
Adam Slumskie, senior wealth advisor and portfolio manager with Intrinsic Financial Group at CIBC Wood Gundy in Sault Ste. Marie, Ont., notes that wealth is often quieter in small communities. Some of his clients don’t have high-income jobs but have been able to save and invest significantly as the cost of living was traditionally lower in rural areas.
“Understanding clients who are in that position is an important aspect of managing their wealth,” he says.
Having a team of specialists is key
While advisors in urban centres have the population to serve well-carved niches such as physicians or small business owners, it’s not possible in smaller communities. Advisors in these locations must serve many different types of clients, Mr. Slumskie notes. When considering clients to take on, he considers whether his services will help that client and if there’s a connection.
“There just isn’t enough of them for a niche,” he says. “Instead, you need a wide knowledge of different financial topics. You have to be a constant learner.”
Accordingly, Mr. Slumskie has seven team members who are specialists in areas such as financial planning, and investing for professionals, corporations, foundations, and private clients.
While maintaining privacy about a person’s financial affairs is obviously required by all advisors, this is especially important in a smaller centre where people are likely to be connected to each other in some way.
Mr. Slumskie uses the example of group client appreciation events popular among many advisors, where the chances of all the clients knowing each other are rare. But in a small town or city, he has found clients prefer intimate one-on-one interactions because “they like to keep that privacy level.”
For more from Globe Advisor, visit our homepage.
Deanne Gage