As financial advisors face the DOL fiduciary ruling and other major changes, their main priority still is to know what matters most to their clients.
Jefferson National released a study on Monday, intended to help advisors better serve current clients and attract new prospects to grow their practice.
“We studied investors in this year’s Advisor Authority to arm advisors with actionable insights that help them understand clients’ needs and build deeper relationships,” Mitchell Caplan, Jefferson National’s chief executive, said in a statement.
“By providing personalized planning and comprehensive guided advice, advisors can help their clients build more wealth—and help their practice grow more assets under management.”
What Your Peers Are Reading
Harris Poll conducted an online survey within the U.S. in March, using a sample from its panel of financial advisors and investors. Among the financial advisors were 440 independent Registered Investment Advisors and 243 Broker-Dealers. The investor sample comprised 167 mass affluent, 184 emerging high net worth, 199 high net worth and 183 ultra-high net worth.
The study identified two investor types and three advisor profiles.
Two predominant investor profiles emerged from an evaluation of chief concerns and unique preferences. Returns seekers, 24% of those profiled, follow an active investing strategy and require low-touch engagement.
Seventy-three percent of these are millennials, and 69% have $1 million or more in investable assets. For a third of these investors, the fiduciary standard was their main factor for selecting an advisor.
A big majority thinks volatility will increase, and feels pressure to respond by changing their strategy.
Seventy-two percent expressed confidence that robos could manage volatility. Leveraging robos was a top factor for selecting an advisor.
Relationship seekers, 44% of investors profiled, are older and less affluent: half are boomers, and 70% have less than $1 million in investable assets.
Their investment strategy is passive, and they require high-touch engagement. Three-quarters said years of experience was their top factor for selecting an advisor.
Sixty-five percent expect volatility to increase, but only 27% feel pressure to revise their strategy.
Robos are a nonstarter for this group. Thirty-three percent were not familiar with robos at all, and just 14% were confident that robos can manage volatility.