Just as fashionistas once declared that pink was the new black, the mass affluent consumer is on the verge of overtaking the high-net-worth client as a desirable customer base for retail banks, according to an HNW Inc. survey released on Tuesday.
But the majority of mass affluent customers don’t consider advisors from their primary banking institution as good resources for advisory and financial planning services, according to New York-based HNW Inc.’s survey of 422 individuals with $100,000 to $3 million in liquid investable assets including rollover 401(k)s.
“The ’new black’ is the mass affluent consumer,” said HNW CEO Stacey Haefele at a media lunch, noting that these customers represent a huge yet overlooked opportunity for advisors in the retail banking space. “There are plenty more of them than high net worth individuals.”
A significant 76% of survey respondents said they do not use their primary bank for investment or brokerage accounts, and the vast majority, 78%, had never considered their primary bank as an option to provide advisory services.
Trust Is an Issue
“In fact, 30% go so far as to note that they don’t trust using an investment advisor at their primary bank,” says an HNW news release. Further, 42% did not believe that their primary bank was the best option for investment and brokerage account services.
Haefele, whose independent marketing firm paid for the research out of its own pocket, would not name the banks that survey respondents mentioned, but she did say that they covered a range of community, regional and big banks.