Most firms treat annual reviews like they’re dentist appointments: routine, reactive, scheduled like clockwork and not particularly enjoyable or enlightening for the client.
Even though the content, information and conversation are valuable, the structure itself undermines the relationship by signaling that the client’s financial life gets attention once a year, on a date picked well in advance, in accordance with a largely static agenda.
Clients have always accepted this, but that doesn’t mean they always will.
The Annual Review Origin Story
In its defense, the annual review was designed to address real firm needs:
Compliance departments need a paper trail showing advisors have met with clients and reviewed their plans. Operations needs to process dozens of households efficiently, so firms batched meetings into predictable windows rather than being proactive about addressing client situations as they arose. Asset-based fee structures rewarded growing assets under management (AUM), not deepening relationships.
Annual review cycles checked every box and so over time, they became the relationship itself.
Firms began defining service tiers by meeting frequency: one review for standard clients, two for preferred and quarterly for top households. The intention of structured, scalable service also came with the unintended consequence of conditioning clients to expect their financial lives to move in annual increments.
Elsewhere, they’re getting a different kind of conditioning.
The Modern Service Experiences You’re Competing With
Every major service your clients use has shifted to proactive, personalized communication.
Every major service your clients use has shifted to proactive, personalized communication. Credit card companies initiate fraud alerts the moment unusual activity is detected; insurance applications flag changes in coverage before renewal. Amazon lets customers know when a subscription is about to ship.
Your clients receive real-time outreach from every other service provider. Then they sit across from you once a year.
When YCharts surveyed nearly 800 advised clients in early 2024, the results were alarming enough that the research team ran the survey twice to confirm: 75% of respondents had either switched advisors or seriously considered doing so in 2023, up from 47% the year prior. The number one metric for client satisfaction was whether the advisor deeply understood them or their goals.
The False Security Of The Scheduled Review
The annual review keeps compliance covered and creates the appearance of diligence. But it also assumes your clients’ financial lives are episodic and calculated when in reality:
- Roth conversion windows are closing
- Business sale opportunities can pop up at any time
- Legislative changes turn beneficiary structures into liabilities if no one is watching
If you’re not consistently looking around the corner for your clients because their annual review is four months away, you’re creating a potential retention problem.
The Elements Of A Modern Client Experience
I’m not advocating for simply adding more meetings to the calendar; a second review won’t solve the underlying problem. Today’s clients value relevance, context and proactivity more than a scheduled, check-the-box cadence. They want to hear from their advisor when something matters, not because the calendar says it’s time.
Today’s clients value relevance, context and proactivity more than a scheduled, check-the-box cadence.
Modern firms are rethinking the review model, implementing:
- Segmentation built around complexity, not arbitrary frequency. Service intensity should match the complexity of a client’s life, not how much they pay. A client navigating a business transition, a divorce or a multigenerational estate needs a fundamentally different engagement rhythm than a client in stable accumulation mode.
- Trigger-based outreach over calendar-based outreach. Market dislocations, tax law changes and life transitions should all be surfaced automatically by a well-built CRM, enabling the advisor to respond proactively to timely needs.
- Technology that supports the relationship. AI-assisted note takers, automated follow-ups and real-time dashboards alleviate some of the traditional operational burden surrounding meetings, giving advisors more time to be present with clients.
- Planning conversations alongside review conversations. Review conversations recap what happened, while planning conversations address what’s changing next. Clients want both the context of the past and the roadmap for the future.
Implementing A Continuous Service Model
Shifting from an annual review process to a continuous service model demands both operational and philosophical changes. Advisors who build their week around scheduled reviews think and act differently than those who build around trigger monitoring.
The evolution from scheduled and reactive to a professional standard of productivity comes from the top.
The evolution from scheduled and reactive to a professional standard of productivity comes from the top. Firm leadership has to commit to the change, hold the team accountable and build processes, workflows and metrics around implementation and adoption.
YCharts makes a compelling business case for the effort: The same survey mentioned above found that clients who received frequent, personalized communication from their advisor reported confidence levels in their financial plan more than three times higher than those who received infrequent contact — 71% versus 22% — when asked how they’d feel if the U.S. entered a recession.
There’s no question the structure of the annual review is familiar, compliance-friendly and operationally tidy; unwinding it in favor of a trigger-based approach won’t be without its challenges. But as our world, client expectations and financial planning as a service evolve, ask yourself: Is it worth clinging to the old model at the expense of your clients’ needs?
Brandon Garrett is CEO of BentOak Capital.
This article is published under WSR’s partner program and was not written by WSR’s staff or editors. For more information on how to participate in the partner program, contact zack.drew@wealthsolutionsreport.com. Views expressed are the author’s and do not necessarily reflect the views of WSR.
