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With Thanksgiving suddenly behind us, it's time to start looking forward to what many consider 'the most wonderful time of the year. As the holiday season is now upon us, it is time to start thinking of gifts for your friends, family, and clients.

Gift giving puts you and your firm at the top of your client's awareness and demonstrates your gratitude for their business. However, you can go wrong with gift giving. It is essential to be thoughtful about the gifts you give. Giving your client a gift this season is a great way to show how well you know your client and that they are on the top of your mind.

Client gifts are typically tricky to come up with and are accompanied by regulatory issues you have to consider. Let's investigate how to give a client gift as a Financial Advisor.

client gift red gifts

Client Gift Regulations

When you think of gifts, you probably consider what a person likes and what budget you have. However, as a financial advisor, there is one more consideration you need to make when giving a client gift. When preparing to give your clients a holiday gift this season, the compliance requirements accompanying this act must be kept in mind.

To comply with FINRA rule 3220, also known as the gift rule,  no client gift can exceed $100 in one year.[1] FINRA put this rule in place as an exception to the non-cash compensation rules. The exception means that you can give gifts, but they cannot exceed that $100 limit yearly per person. You can read more about the specific regulation on FINRA's website.

If you are anything like me, someone who loves to give gifts, having strict rules on how much to spend on gifts can seem a bit disappointing. However, the rules set are for a good reason, and there are still great client gifts you can give for under $100.

Client Gift Considerations

One way to show sincerity to your clients is to select a gift that is personal and meaningful to that client. Here are some considerations you should make when choosing a client gift:

1. Age: This may seem like a no-brainer, but you must consider your client's age when giving them a gift. Make sure the gift is something someone of their age would actually use.

2. Geographic location: Mittens are a cute gift in Connecticut, but they won't be as helpful if you live in Southern California. Ensure the client gift you select is usable in your client's geographic location.

client gift map

3. Price: Regulations aside, price is still an important consideration to make. Purchasing something cheap may be considered disrespectful. Seek out quality over quantity. Try to aim for quality client gifts under the $100 limit.

4. Size: While this consideration in selecting a client gift is logistical, it is still vital. How are you going to get this item to your client? Will they be able to carry it or bring it on a plane?

5. Hobbies: Show your clients that you have been paying attention to them by purchasing a client gift that reflects their hobbies.

The bottom line, when it comes to gift giving, is to think about what matters to your client. What makes them happy? What are they interested in? When you make considerations such as these, the gifts you give become very thoughtful and meaningful to the recipients.

Client Gift Examples

Here are some client gifts and the considerations made while selecting them.

1. Mortar and Pestle: This client gift runs well under $100 and can be very high quality at a reasonable price. A mortar and pestle would be a wonderful gift for a client that expressed an interest in cooking or has recently moved into a new home.

2. Coffee Table Photo Book: This gift is incredibly flexible because you can choose the content of the photos. Furthermore, good photography makes a quality gift, and your client can use it as décor, a sentimental memory, or reading material.

3. Fountain Pen: Fountain pens are an excellent client gift for a client you may not know as well. It is suitable for any businessperson and has both utility and decorative purposes. It is a business gift.

4. Subscription: The best gifts are the ones that keep on giving. A way you can continue to give to your client and keep yourself on the top of their mind is by purchasing an annual subscription for then. There are subscriptions for a multitude of things like razors, soap, coffee, wine, etc. This is a low contact gift that would be delivered to your client through the mail.

5. House Plant: This gift you would give to a client you know enjoys plants. If you have seen a plant on their desk or they have spoken about plants to you, this client gift would be very thoughtful. Try to avoid giving a plant to a client that you don't know if they like plants or if they travel a lot. A plant could be burdensome for a client like that.

client gift plant

6. Donation In Your Client's Name: This client gift is significant if you have a charitably inclined client. Donating to their favorite charity in their name shows your client that you know their heart and favorite charity. It also benefits whatever charity the money ends up going to.

7. Charcuterie Board: A Charcuterie Board is a beautiful client gift for clients you know like to host people in their homes. These boards can be exceptionally well made for a very reasonable price.

client gift char board

8. Water Bottle: A high quality water bottle can be hard to come by and is something that many people use. You can tailor the water bottle to match your client's lifestyle while still providing a useful and thoughtful client gift.

Keep in mind that the best gifts are personal. If you don't know your client well, or could not find a gift personal to them, you can still include a personal touch. Adding a handwritten note and ensuring the gift is well packaged and presented shows consideration and thoughtfulness. If you can, try to deliver the gift yourself, so the client remembers who gave them the gift.

Don’t forget to report the gift following your firm’s policies and procedures.

You've heard people say, 'it's the thought that counts' and they are right. Put thought into your client gifts this season.  Your clients may not remember who gave them the most expensive gift, but they will remember the most thoughtful gift. You can purchase many gifts within the regulatory requirements that signify gratitude and thoughtfulness. Utilizing the opportunity to give client gifts this year may be the thing to set your firm apart.



This communication is general in nature and provided for educational and informational purposes only. It should not be considered or relied upon as legal, tax, or investment advice or an investment recommendation, or as a substitute for legal counsel. Any investment products or services named herein are for illustrative purposes only and should not be considered an offer to buy or sell, or an investment recommendation for, any specific security, strategy, or investment product or service. Always consult a qualified professional or your own independent financial professional for personalized advice or investment recommendations tailored to your specific goals, individual situation, and risk tolerance.

Dunham & Associates Investment Counsel, Inc. is a Registered Investment Adviser and Broker/Dealer. Member FINRA/SIPC.

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