Podcast Center
Video Center
Webcasts
Resource Center
Events
August 06, 2014 at 11:27 AM
As regular readers of this blog are probably aware, I tend to be pretty skeptical about much of the hoopla these days surrounding social media and Internet sites. I’s not because I don’t think they could be true, it’s just that most of the time, there’s very little evidence to show that these claims are true. However, when some hard evidence does come along, that’s an entirely different matter.
Case in point: PaladinRegistry.com’s recently released survey on how investors find, screen and select financial advisors. Paladin, you may know, is an online database that matches pre-screened financial advisors with investors who are looking for advice. So it does have a bias about where investors do find advisors. What’s more, it’s not up-to-the-minute recent: it’s based on survey data from the fourth quarter of 2013. It’s not a large survey by any means: just 386 participating investors out of Paladin’s database of some 38,000 investors who used their services during the past two years.
However, it’s a pretty good target sampling: the average age of those investors was 48, with average available assets of $385,000, and 71% of the respondents either had advisors or had used advisors in the past. What’s more, 32% of them came to Paladin.com seeking financial advisors, while 68% were seeking information about advisors. Taken together, the survey makes a pretty compelling case that, at least as far as the Internet is concerned, there is plenty of opportunity for independent advisors: and those who don’t have a solid—and searchable—web presence, need to get one.
Here are the findings:
1) How Do Investors Find Financial Advisors?
39.5% used referrals from family, friends and associates
25.3% used the Internet to find a financial advisor
13.4% used referrals from CPAs and/or attorneys
Notice that, for this group at least, while the Internet hasn’t overtaken referrals as a source of new clients, it’s already passed accountants and lawyers—and is closing the gap for the No. 1 spot in, what, the past ten years? Max. That’s a pretty healthy rate of increase.
2) Why do investors use the Internet to find financial advisors?
74.8% said the Internet enabled them to find and research advisors while maintaining their anonymity.
This should be a big “aha!” for independent advisors. In today’s overhyped world, three out of four investors don’t want a sales pitch from a financial advisor. And I don’t think I’ve come across a group as anti-sales as the independent advisory community.
