In the early 1990s, when I was at Worth magazine, I interviewed a number of the wealth managers at JP Morgan Private Bank. One of them told me that they’d recently gotten a call from a man who was very apologetic about bothering them, as he “probably wasn’t wealthy enough to meet their minimum. But he’d seen their magazine ad, and thought he’d call anyway.” He had just sold his business for $500 million. As you might imagine, the good folks at JP Morgan were more than happy to help him out.
As most advisors eventually come to realize, people have some pretty funny ideas about money. I came across a more recent example in a blog by advisor Phil Simonides of Tysons Corner, Virginia, posted Feb. 2 on WSJ.com: “The Misperceptions That Cause People to Avoid Financial Advisers.”
You may notice the unusual use of the term “adviser” in that headline, made even more curious by Simonides’ bio, that lists him as affiliated with McAdam LLC in Philadelphia, which, as far as I can tell from its website, is a broker-dealer and an insurance agency. I can only conclude that the use of “adviser” is a typo by the WSJ.
Simonides’ story is based on an Oct. 2015 survey conducted by Harris Poll (on “behalf” of McAdam), of 2,009 Americans on their attitudes toward “professional financial planning.” Simonides called the results “striking,” which I suppose they are: that is, if you’ve never gone to a financial advisor (or “adviser”), or to any other kind of professional. But since Phil seems to be surprised, I suspect that many other advisors/advisers would be surprised by the survey results, too. Which is a shame, because advisors who aren’t aware that clients are nervous about seeing them are probably not taking any steps to raise their comfort levels.
The most “striking” results from the Harris/McAdam survey is that some 71% of respondents said that some “aspect of meeting with an adviser [sic] scared them.” Even considering people’s curious attitudes about money, you have to admit, that’s a pretty big number—well into the “most” category. To reach that total, their leading concerns were “costs” (49%), “trust” (47%), and “the inability of an adviser to help them with their financial situation” (41%).
In reaction to these numbers, Simonides wrote: “It troubles me that many potential clients decide not to hire a professional based on perceptions that aren’t grounded in reality…. …If [financial advisors] want the opportunity to grow our practices and, more important, to help more clients reach financial freedom, we must actively address and correct these misperceptions.”