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New Investor Research Conducted in March 2020 Reveals Insights and Perceptions about working with Advisors in Challenging Times

Issue date: Wednesday, April 29, 2020

Contact Information: Devon Coquillard | +1 303 850 3202 | Contact Email: dcoquillard@i-w.org


New Investor Research Conducted in March 2020
Reveals Insights and Perceptions about working with Advisors in Challenging Times

 

New Study Indicates Current Crisis Impacts Client Loyalty and Confidence
and Highlights Unique Opportunities for Advisors.

DENVER (April 29, 2020) – A new special report released by the Investments & Wealth Institute®, 2020 Investor Research: The Current Crisis, the Impact on Client Loyalty, and the Implications for Your Business highlights the shifts that are occurring in clients’ views, provides a look at what clients need, want, and expect during an unprecedented time, and explores how advisors can support clients to bolster confidence and loyalty.

The research, fielded by Absolute Engagement, gathered input from just over 750 investors across the United States via an online survey, between March 10 and March 24.  All respondents work with a financial advisor, make or contribute to the financial decisions in the household, and meet specific asset criteria.

According to the survey, 90% of clients are “very satisfied” with their advisors and are delivering on the attributes that clients rate as most important: trust, accuracy, ethics, and knowledge. Despite this positive metric, the study also finds there is a potential looming loyalty crisis. Due in large part to the timing of the study, which was conducted during a period of historic social, market, and economic turmoil, the study points to larger number of clients who are questioning whether their advisor is providing the advice and guidance they need. In 2019, 21 percent of clients reported that they had considered changing advisors, in 2020 that number jumped to 31 percent. Even more interestingly, this jumped to 44 percent for individuals who responded between March 16-24, which indicates just how big an impact the market disruption had.

The cause for the change in client loyalty stemmed from clear relationship gaps in six areas, with the largest gap being, “client perception that their advisor may not be putting their needs first when making recommendations.” Eighty-one percent of respondents rated that as “very important,” but only 63 percent “completely agreed” that the advisor was delivering.

In addition to relationship gaps, there are clear confidence gaps. Four confidence gaps were identified that reflect how clients are feeling, rather than the service their advisor is providing:

  • Feeling financially secure

  • Feeling in control of reaching my financial goals

  • Feeling confident in my ability to reach my financial goals

  • Having a clear plan in place to reach my financial goals

These confidence gaps highlight an opportunity for advisors to support clients in new and more valuable ways.

Confidence is not only a reflection of what is happening in the markets and the value of portfolios. Advisors cannot impact world events or the markets, any more than their clients can. Advisors can, however, help clients to feel more in control and more confident in their own abilities. And they can ensure the plan is both clear and communicated. At a time when things feel out of control, advisors have a unique opportunity to raise the collective level of confidence among their clients,” said Julie Littlechild, Founder and CEO of Absolute Engagement, and author of the Investments & Wealth Institute-commissioned research.

In order to help clients, advisors will need to gain a deeper understanding of the real challenges their clients are facing and respond with content or educational opportunities that reflect those needs. In so doing, advisors can demonstrate leadership, enhance client confidence, differentiate their practices, and retain their clients.

The world is navigating through unique challenges and rapidly emerging norms, and investor needs are significantly different today than two months ago, with investors making changes in their lives and businesses. What does this mean for advisors? It means that the current environment is one of the most significant threats to businesses and one of the greatest opportunities to provide clients with meaningful support that goes beyond investments and planning,” said Sean R. Walters, CAE®, Chief Executive Officer of the Investments & Wealth Institute.

The special report is available as a downloadable PDF, and via an Exceptional Advisor Webinar, both hosted by the Investments & Wealth Institute to encourage the practice of high standards of professional conduct and improve the overall competency and professionalism of advisors. Registration proceeds from the Exceptional Advisor Webinar Series will support the Institute’s Certification Scholarship Fund.
 

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For Information:
For additional information, contact Devon Coquillard, communications manager, dcoquillard@i-w.org or (303) 850-3202.

About the Investments & Wealth Institute®
Established in 1985, the Investments & Wealth Institute, is a non-profit professional association, advanced education provider, and standards body for financial advisors, investment consultants, financial planners, and wealth managers who embrace excellence and ethics.

The mission of the Investments & Wealth Institute is to deliver the premier investment consulting and wealth management credentials and world class education, in order to encourage the practice of high standards of professional conduct and improve the overall competency and professionalism of advisors.

Investments & Wealth Institute administers three certifications, Certified Investment Management Analyst® (CIMA®), Certified Private Wealth Advisor® (CPWA®), and Retirement Management Advisor® (RMA®). Through its publications, live events, online courses, assessment-based certificate programs, and advanced certifications, the Institute delivers premier-quality, practical education to advanced practitioners in more than 39 countries.

 

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