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Investors Demand More Diversified Products, Customized Advice: Study

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What You Need to Know

  • Investors want products that cut across wealth, insurance and banking and align with their values.
  • Gen X, millennial and Gen Z investors were more than twice as likely as baby boomers to have asked about ESG investments.
  • With trillions being passed down over the next 30 years, wealth managers face a heightened sense of urgency.

North American investors increasingly expect comprehensive and more personalized offerings from their financial advisors, with products that cut across wealth, insurance and banking and align with their values, according to research Accenture released Tuesday.

Accenture conducted an online survey in March and April among 1,000 investors across the U.S. and Canada who have a financial advisor. Respondents ranged in age from 20 to 93 and in personal wealth from less than $250,000 to more than $10 million. 

What Investors Want

As for financial advisors, they have gotten better at providing hybrid advice that combines digital, virtual and human interaction, but they may not be as effective in delivering the right advice and products at the right time for investors, the report said.

This is especially true for Generation Xers, millennials and Gen Zers, whose advice needs and preferences differ from those of baby boomers. Consider one example from the study results: 97% of Gen Zers, 91% of millennials and 85% of Gen Xers expect their advisor to offer banking and insurance products, compared with only 47% of boomers. 

Younger investors are also likelier to be interested in products that align with their lifestyle preferences, including sustainability. The three groups of younger investors were more than twice as likely as boomers to have asked their advisors about environmental, social and governance or socially responsible investments.

Eighty-four percent of respondents who asked about sustainability investments plan to purchase them in the next year, the study found.

The research also shows that investors want their advisors to provide more personalized advice that covers all aspects of their financial portfolios. 

Fifty-five percent of respondents said the advice they receive is too generic, including 50% of those with personal wealth between $250,000 and $1 million. Another 55% think that they could do a better job investing themselves. And 56% consider a wealth offering that includes advice, risk protection and lending products essential. 

“Our research findings show that investors expect a deeper level of engagement with their advisor that goes beyond pure portfolio management,” Scott Reddel, leader of Accenture’s wealth management group in North America, said in a statement. 

“The wealth managers who thrive in the years ahead will embrace AI, data and analytics and cloud-computing to power their advisors with the intelligence and tools to offer holistic, personalized and integrated wealth advice.” 

The Pressure Is On

With trillions of dollars in investable assets expected to be passed down to younger generations over the next three decades, the report’s findings create a heightened sense of urgency for wealth managers, Accenture noted. 

Fifty-eight percent of survey respondents said they expect to inherit a significant amount of money or an estate from their parents. Twenty-six percent plan to choose a new advisor to oversee all of their assets upon inheritance, including 51% of investors with personal wealth of $10 million or more. 

Asked what offerings would make them entrust more assets to their current advisor, 53% said greater and more diversified products and services, and 34% said a hyper-personalized experience. 

The survey findings also showed that younger investors are more receptive to financial advice from non-traditional sources outside wealth management. Ninety-five percent of Gen Zers, 83% of millennials and 74% of Gen Xers said they would consider wealth products and services offered by Google, Apple and Facebook, compared with only 30% of boomers who said they would do so. 

Younger investors are also at least twice as likely as older ones to trust financial advice generated instantly by an algorithm more than advice provided by a human advisor. 

“The days of tailoring the level of service to fit the size of an investor’s portfolio are over; the average investor expects the same level of service and personalization as someone in the high-net-worth bracket,” Rachel Silver, a managing director in Accenture’s North America wealth management group, said in the statement. 

“Wealth management firms should reimagine their advice offerings at scale to provide a seamless client experience with curated recommendations and a purpose-driven product suite that reflects investors’ social interests and key life moments.” 

Other Key Findings 

Seventy-one percent of investors surveyed said they want to engage with an advisor whose values are aligned with their own, while 69% want an advisor who interacts with and considers input from their spouse. 

Seventeen percent of respondents reported that they had switched advisors in the last year, with 49% each having been lured by better technology offerings and better investment product offerings. 

Thirty-nine percent of investors said they want to hear from their advisor more proactively, and 29% said they are willing to take more meetings with their advisor.