It's crunch time for CRM2: here's what advisors can do to prepare clients.

The financial industry has been working towards this final phase of CRM2 for months … and now it’s crunch time. Many firms will be sending out their new Fee and Performance Reports over the next few weeks. Soon Canadian investors will gain new insights into the cost and performance of their investments. 

Are you prepared for the potential reactions of your clients? Do you know the best way to talk to them about their new CRM2 reports?

Fortunately, if you haven't already done so, you still have time to reach out to your clients and prepare them for what they’re going to see. By being proactive, you can guide the conversation about their fees and returns and help manage their reactions.

Here are three things advisors can do right now to prepare clients.

1.    Anticipate your client reactions

CRM2 provides new information for your clients – it outlines the fees they paid, both directly and indirectly, in actual dollars, and provides a new personal rate of return for each of their accounts. Research shows that many investors will welcome this knowledge. But, for a large percentage, it will be surprising, and even shocking. If you have clients who are going to see high fees or fees they may not have understood clearly, you should be prepared to deal with the potential sticker shock – as at least 47% of Canadian investors believe they don’t pay any fees or are unsure if they do. (Source: Tangerine Investments, July 2016.) 

Investor fee reaction

2. Identify at-risk clients

It’s important for advisors to analyze their book – which of your clients are most at risk? Money in motion is a very real threat as clients see their fees in dollars for the first time and start wondering about how they can reduce them. Identify and prioritize who to contact. The natural reaction is to contact your high net worth clients. While they're important, they may not be your most at-risk. They’re often well-served and feel they’re getting good value from you and your firm for their fees. Rather, be sure to look at your mid-level clients. The clients with relatively high fees who receive lower service may be more of an issue as they’re more likely to question the value they’re receiving.

3.    Start talking to clients now

There’s still time to talk to clients before the CRM2 reports land. Be proactive and prepare clients for what they’re going to see. Don't let the new performance and fee information catch them by surprise. By now, you most likely know what their fees will be along with the personal rates of return on their accounts. Be sure to remind them of the value they get for the fees they pay.

If you're unsure of how your clients will react, ask about our Money in Motion Assessment. We’ll help you identify the danger zones and coach you on how to have comfortable, confident conversations with your clients about fees, performance and the value you provide.

To get started, get in touch at or (416) 527-0323

Money in Motion