the advisory career

Affluent Investors Regaining Trust in Financial Advisors

Ranking Them Near Primary Care Physicians in Trust and More Trustworthy Than Attorneys and Accountants

CHICAGO, IL, December 1, 2016 /Marketwired/ — A new Spectrem Group study reveals rising satisfaction among affluent investors with their financial advisors, although it remains lower than before the Great Recession.

This improved satisfaction is translating into increased trust, with most wealthy investors now ranking their advisors almost as high as their primary care physician in terms of trust, and more trustworthy than their attorney and accountant.

Spectrem’s reports, Advisor Relationships and Changing Advice Requirements, identify how trust plays a critical role in influencing how investors choose and work with their financial advisor, and identifies ways in which advisors can strengthen their relationship with their clients. The reports focus on the Mass Affluent investor (with a net worth between $100,000 and $1 million, Not Including Primary Residence), the Millionaire investor (with a net worth between $1 million and $5 million) and the Ultra High Net Worth investor (with a net worth between $5 million and $25 million).

“Affluent investors often carry the burden of sustaining and building their family’s wealth, sometimes for generations, which is why it is critical that their relationship with an advisor be built on trust,” said Spectrem Group President George H. Walper, Jr. “Because their hard-earned money is at stake, that trust will literally have to be earned, and frequent and proactive communication by advisors is key to nurturing an enduring relationship built on trust.”

Among all wealth segments, poor communication and lack of proactivity among advisors were cited as the most important factors in deciding to terminate their relationship. Among the Mass Affluent, six in 10 (61 percent) investors indicated that an advisor not returning phone calls in a timely manner would cause them to terminate the relationship. This is even more important among Millionaire and UHNW investors, with 63 percent and 71 percent, respectively, indicating that it would be cause for them to change advisors.

Affluent investors often carry the burden of sustaining and building their family's wealth, sometimes for generations, which is why it is critical that their relationship with an advisor be built on trust.

Other key findings of the study include:

  • Nearly half (45 percent) of Mass Affluent investors want their advisor to initiate contact with them on a quarterly basis.
  • One in five (19 percent) would prefer that this happen monthly.
  • 35 percent of UHNW investors expect their advisor to return their phone call within two hours, and nearly seven in 10 (68 percent) consider a returned call the next day unacceptable.
  • Most wealthy investors are likely to find an advisor through the referral of someone they trust. 51 percent of Mass
  • Affluent investors, 47 percent of Millionaire investors, and 53 percent of UHNW investors are initially introduced to an advisor through the referral of a family member or friend.
  • Nearly six in 10 Millionaires and almost half of UHNW investors believe their advisors are biased toward a certain group of products and more interested in pushing those products than they are in offering advice that will benefit them for the long term.

Additional insights on the three wealth segments examined in the report, as well as information about other Spectrem studies, are available here and Spectrem’s Millionaire Corner, including “Defining “Trust.”




About Spectrem Group: Spectrem Group strategically analyzes its ongoing primary research with investors to assist financial providers and advisors in understanding the Voice of the Investor.
About Spectrem’s Millionaire Corner: Millionaire Corner is a premier independent online resource for investors and about investors. Millionaire Corner delivers timely, relevant and practical information and tools to help fuel financial growth for Millionaire investors and aspiring millionaires. With its Best Financial Advisors service, investors can search for financial and investment advisors to assist in growing their wealth.