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Phoenix: Wealthy Altruists Want Help With Finances

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NU Online News Service, July 2, 2003, 5:53 p.m. EDT – Wealthy people who want to give to others may make great prospects for financial advisors, according to results of a survey of wealthy U.S. residents sponsored by The Phoenix Companies Inc., Hartford.

Phoenix hired researchers at Harris Interactive Inc., Rochester, N.Y., to conduct a Web-based survey of U.S. household financial decision-makers who come from homes with a net worth of at least $1 million.

Phoenix used the survey answers to divide the wealthy into six groups: Deal Masters, Altruistic Achievers, Secret Succeeders, Status Chasers, Satisfied Savers and Disengaged Inheritors.

Members of some groups were wealthy but also reluctant to seek professional financial advice.

Phoenix describes the Deal Masters, or 11% of the survey participants, as relatively young dealmakers who have an average age of 49 and a “winner takes all” attitude about life. They have achieved an average net worth of $3.5 million.

But they have lost an average of only 23% of portfolio value over the past three years, and 91% believe that they are very or fairly financially knowledgeable. Fifty-six percent say they rarely seek professional financial advice, Phoenix says.

Phoenix recommends that advisors try to reach Deal Masters by using a results-oriented approach and showing how insurance products can fit in with the many products that the Deal Masters already own.

The Altruistic Achievers, or 17% of the survey participants, want to share their wealth with others.

They have an average net worth of $2.6 million, and they report losing an average of 33% of portfolio value over the past three years. They admit to losing more portfolio value than members of the other five groups, and only 18% say they shy away from professional financial advice, Phoenix says.

Phoenix recommends that advisors approach Altruistic Achievers by showing how insurance products can help them help family members and charities.

Members of a third group, the Status Chasers, may also be a good target for advisors: they have an average net worth of $2 million, but few have financial plans and only 65% believe that they know much about financial affairs, Phoenix says. The Status Chasers reported suffering an average three-year portfolio loss of 31%.

Stephen Gresham, chief sales and marketing officer at the Phoenix asset-management unit, says advisors should take the differences between high-net-worth market segments into account when approaching wealthy prospects.

“Our research shows no two wealthy clients are alike,” Gresham says. “The winning advisors are going beyond a one-size-fits-all strategy.”