Lessons Learned After 13 Prospects Said No to a Financial Plan

After a slow start, Sidney Divine hopes others will emulate his RIA.

(Illustration by RIA Intel)

(Illustration by RIA Intel)

For years, Sidney Divine was one of the most prolific financial planners at New England Financial, an insurance company that ultimately became part of MassMutual. He was nominated or won the award for financial planner of the year at the company from 2015 to 2017. But an increasing emphasis on selling insurance policies began to feel inhibitive.

“It was like if you had a hammer and everything was [treated like] a nail,” he said. Some clients required different tools. A few were getting bludgeoned.

By separating the sale of any product from his compensation, Divine believed he could make better financial plans for more people. In 2017, he founded Divine Wealth Strategies, an RIA in Atlanta that primarily charges clients a flat annual fee for financial planning, investment management, and the opportunity to call on Divine when needed.

Pressure on fees is leading more RIAs to experiment, but most advisors still say portfolio management is part of their value proposition and charge clients a fee based on assets under management.

Divine was confident in himself and the business model, and it’s worked out so far. Right now, he charges 54 individuals or households, on average, a little more than $5,000 per year (the RIA also manages only a total of $6.6 million in assets). The annual revenue is enough to cover the cost of an office, the necessary services to run the firm, the salary of an operations manager, a stipend for an associate planner, and support the lifestyle Divine wants for his family.

But it wasn’t like that from the start and Divine hopes to offer inspiration for his associate planner and other advisors pursuing a career in wealth management. “Success is about leaving the door open for those to follow,” he said.

Before founding his RIA, Divine already had some breakthrough moments as a financial planner that changed how he does business today. He recalled the day he stopped thinking about financial plans as another product to sell.

“When I first started I thought that was a pitch. Pitch is definitely not the right word. You would almost guarantee yourself a lot of headache and heartache if you went into a financial planning meeting and tried to pitch,” he said. Instead, he started meetings by engaging in a conversation with potential clients about what they were seeking help with. After all, they were already sitting in front of Divine at that point — there was no need to pitch them on why they should be.

He remembered starting out clientless after 13 meetings.

“Activity is king,” said Divine, who spends little time on social media or doing anything else during the workday that he doesn’t see resulting in new clients, or adding value to existing ones. Although, at some point, doing the same thing repeatedly and expecting a different result is insanity, he said.

So, he did away with the sample financial plan — a binder he used at the insurance company — that he presented in initial meetings. It was getting in the way of the conversation and discovery process. “It was almost like selling a car. It wasn’t the right way to do it,” he told RIA Intel.

“Most people actually know what they need to do. But knowing and doing are two different things. So, I think I started approaching it more as ‘hey I’m going to be your accountability partner’ and I think that was the major switch.”

Now, at Divine Wealth Strategies, dedicating time differently to prospects also means unearthing things even their existing advisors aren’t asking about.

Divine was stunned when a woman referred to him said her advisor at the time didn’t ask about her student loans, or her goal to visit her mother overseas at least once per year. A fan of anime, she was also set on someday visiting Japan but never discussed that with a financial advisor before meeting Divine. In an attempt to keep the woman as a client, her former advisor told her she wasn’t wealthy enough to need a financial plan.

“I think that kind of sums it up,” Divine said, in reference to the woman, an example of the need and desire for financial planning.

There is a dearth of young talent in the wealth management industry, and Divine hopes to be part of the solution. He is not dogmatic about how advisors should be charging clients, but he does believe that financial planning will continue to become more prevalent and slowly dictate how fees for the service are charged.

And he’s passing on what he’s learned to his associate, Shaun Patterson. “I believe that she’s going to be even better at this than I am.”

How much bigger his RIA will get, or planners he’ll hire, he doesn’t know.

It’s not always “if you don’t grow, you die” in wealth management. A focus on financial planning is not a means for Divine Wealth Strategies to accumulate $1 billion under management, or to enrich Divine, and he’s okay with that. He likes to repeat a phrase a mentor (another financial planner) shared with him.

“We get paid extremely well for what we do and, by the way, the money isn’t bad either.”

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