Many financial advisors dream of catering to the most elite investors seeking advice on how to invest their great fortunes. With thanks to the Spectrem Group, which surveys ultra-high-net-worth investors–those with $5 million to $25 million in assets to invest–on a quarterly basis, here is an inside look into the attitudes and characteristics of the denizens of elite advisors’ mahogany-paneled executive suites.
- The ultra-high-net-worth are young retirees, who amassed their great fortunes as managers, business owners and senior corporate executives. Their average age is 61; only 24% are still working full-time. The fully retired (63%) vastly outnumber the semi-retired (13%).
- Most of the ultra-high-net-worth seek the help of a professional advisor. A third of UHNW investors enjoy regular advisory relationships and another 27% seek an advisor’s help when events impel them to–for example, when they want to plan for retirement or diversify an overly concentrated portfolio after a corporate liquidity event. There is plenty of room for advisors form new relationships or expand existing relationships with UHNW investors. Fully 43% of UHNW assets are untended by advisors. And while UHNW investors express the highest level of satisfaction with their advisors (80% are satisfied), a smaller percentage (70%) were pleased
While little in this report should come as a surprise to those familiar with ultra-wealthy investors, the very low satisfaction with advisor blogs may provide the best clue as to how advisors may prospect among this client segment.
Spectrem suggests that newer forms of online communication may provide an opportunity “not only to communicate with existing clients but to appeal to prospective clients who will become familiar with your investment attitudes.” Such communications may also provide advisors with a venue to build the reputation for honesty and trustworthiness that UHNW investors desire most in an advisor.