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Identifying What Investors Value in a Financial Adviser: Uncovering Opportunities and Pitfalls
General Information
Title
Identifying What Investors Value in a Financial Adviser: Uncovering Opportunities and Pitfalls
Author
Ryan O. Murphy, Samantha Lamas and Ray Sin
Publication Type
Journal paper
Outlet
Journal of Financial Planning Association
Year
2020
Abstract
Understanding what investors value and look for in a financial adviser is critical to both the client’s and adviser’s success. This research identified the alignment and discordance between what non-retired investors value, and what financial advisers think their clients value. These insights show opportunities for advisers to better articulate their value and, in doing so, improve attraction, retention, and promote client satisfaction.
Using an online platform, investors were asked to rank a set of 15 adviser attributes from most important to least important. Advisers were asked to rank the same attributes, predicting what they thought investors valued.
Results show that both groups recognized that reaching financial goals is a top priority, with notable disagreements on how to achieve this.
Investors underestimated the importance of behavioral coaching in helping them stay on course. Advisers underestimated the importance of tax-efficient strategies to their clients.
A follow-up study tested different ways of describing behavioral coaching to potentially find better wording that more naturally resonates with investors, and results suggest that simple changes in phrasing and communication can improve how investors perceive the value behaviorally attuned advisers bring to the relationship.
Using an online platform, investors were asked to rank a set of 15 adviser attributes from most important to least important. Advisers were asked to rank the same attributes, predicting what they thought investors valued.
Results show that both groups recognized that reaching financial goals is a top priority, with notable disagreements on how to achieve this.
Investors underestimated the importance of behavioral coaching in helping them stay on course. Advisers underestimated the importance of tax-efficient strategies to their clients.
A follow-up study tested different ways of describing behavioral coaching to potentially find better wording that more naturally resonates with investors, and results suggest that simple changes in phrasing and communication can improve how investors perceive the value behaviorally attuned advisers bring to the relationship.