Many financial professionals are taught that getting referrals is achieved by asking, “Do you have three friends, neighbors, or family members we could help?” But is that really the best approach?

Our research found that financial planners who use technology to work collaboratively with their clients achieve better client outcomes and improved referral rates. However, we also uncovered a 33-point gap between how often advisors believe they are being referred and how often their clients say they are making referrals.¹

If you provide personalized, collaborative financial planning that is helping your clients achieve their goals but isn’t garnering the referrals you need to grow your business, here are some tactics you can employ to ensure you are making the most of these positive outcomes.

Set Up Processes for Managing Client Referrals

Having procedures and scripts in place before actively pursuing referrals is crucial for an organized and professional approach. Develop a system for capturing details about your clients’ friends and family members who could benefit from your services. This allows you to identify and keep track of referral opportunities as they arise organically through conversations.

At the same time, decide how you will handle client referrals that may not be an ideal fit for your particular offerings or client profile. Maintain a list of trusted resources or other financial professionals you can refer these individuals to, ensuring they still receive guidance even if you cannot directly assist them.

It’s important to position referrals as “introductions” rather than direct client acquisition attempts. This subtle shift in framing can help make the process feel more natural and conversational, reducing any perceived pressure or sales tactics. Your goal is to facilitate connections that could be mutually beneficial.

Best Times to Ask for Referrals

One of the most opportune times to ask clients for referrals is after delivering a positive experience that provided clear value. This could be solving a complex problem, minimizing their tax burden, or achieving a major financial goal. When clients can tangibly see how you’ve improved their situation, they are much more likely to want to share your services with others they care about.

Annual reviews and meetings where you’ve helped clients reach important milestones are excellent opportunities to request referrals. You can reflect on the progress made over the past year and how your guidance has contributed to their financial success. Clients will be in a positive mindset and more inclined to pay your good work forward.

Similarly, any time a client proactively expresses satisfaction with your services or thanks you for your efforts, it creates a natural opening to ask if they know anyone else who could benefit from working with you. When clients are feeling appreciative, they’ll be more receptive to making an introduction.

Asking for Referrals

Getting a referral starts by asking for one, but it’s key to do so strategically. To leverage satisfied clients for business growth, approach the request naturally and positively, with the right mindset:

• Ask genuinely and authentically. Avoid seeming pushy by listening for opportunities, such as hearing of a client’s new colleague at work. Let your client base know that you want to grow your business and appreciate the opportunity to work with any referrals they may know.
• Frame the ask positively. Present the request as an opportunity for the client to help others, not as a favor to you.
• Mention the people you enjoy helping. Highlight the clients you’ve been able to support effectively, making it easier for them to identify someone who could benefit. Ask for introductions if they know someone who’s a good match.
• Focus on connection. Highlight the personal relationship and trust you’ve built, which can inspire the client to support your practice through referrals.
• Make the process simple. Provide a seamless way for clients to refer others, such as a quick online form or a pre-drafted email template.
• Bridge the gap. Encourage clients to go beyond providing a name by facilitating introductions or sharing the referral story directly with the potential client.
• Let rejection teach. “But what if they say no?” Well, that’s okay, too. Not everyone is comfortable giving referrals, and that’s perfectly fine. Be understanding and gracious, and don’t let it get you down. If you never ask, you’ll never learn about your clients.

All these ideas help you to remember that clients are more than just their financial portfolio—they also have a network of connections who could become your future clients.

Practice a Scripted Approach to Referrals

Just as you should have standard operating procedures in place for your other key business processes, standardizing your approach to referrals is a key component of client acquisition. Consider adapting these scripts as part of your process.

Suggest a Casual Group Lunch

One effective way to ask for referrals is to suggest a casual group lunch or coffee meeting where you can meet your client’s friend or family member in a relaxed setting. This takes the pressure off and allows for a natural conversation where you can get to know the potential new client. When you become aware that a client knows someone who could benefit from your services, propose something like, “I’d love to take you both out for lunch sometime and hear more about how you know each other.”

Offer Shareable Information and Guides

Provide your clients with helpful information, budgeting guides, or resources they can easily share with others. This gives them a natural way to introduce your services without directly asking for a referral. You can say something like, “I have this great guide on retirement planning. Feel free to pass it along to anyone you think could benefit from the information.”

Help Develop “Referral Stories”

Work with clients to develop their own “referral story” that outlines how you helped solve a specific problem or achieve a goal. When they can articulate the value you provided, they’ll feel more comfortable recommending you. To guide the conversation, ask questions like

• What was the biggest challenge we helped you overcome?
• What did we do to address that issue?
• What do you feel was the greatest impact of this work or accomplishment?

While scripts can be helpful, be sure to use natural, conversational language. You might say something like, “Joe, I’m curious—what was the biggest problem we were able to help you with when we started working together?” This opens the door for them to share their positive experience, which you can then leverage by asking if they know anyone else facing a similar situation.

The Importance of Referrals

“Asking for the sale” is a step in the typical sales process that refers to the crucial moment when a salesperson directly requests a potential customer to purchase their product or service. While financial professionals should be cautious about feeling too transactional, honing a process to ask for referrals will help you grow your business by avoiding missed opportunities.

To ensure those opportunities continue to present themselves, you should continually seek feedback from clients on improving the overall experience you provide. Referrals are a powerful indicator of the health and success of your practice. Ask clients directly what you could do better to become more referable and increase the likelihood they’ll enthusiastically recommend you. An exceptional client experience is the foundation for a steady stream of referrals.

To learn more about the psychology of referrals and why they are so effective at driving new business, read our blog, Understanding the Psychology of Referrals in Financial Planning.

Sources:

1 eMoney, “Planning Better Together” Research, October 2024

DISCLAIMER: The eMoney Advisor Blog is meant as an educational and informative resource for financial professionals and individuals alike. It is not meant to be, and should not be taken as financial, legal, tax or other professional advice. Those seeking professional advice may do so by consulting with a professional advisor. eMoney Advisor will not be liable for any actions you may take based on the content of this blog.

You may also be interested in...