Working with a financial adviser provides enormous benefits to clients, helping them efficiently manage their money, grow their savings and achieve their financial goals. While each client may have different needs and expectations, they all have one thing in common: the expectation of communication.
Effective communications practices are critical to financial advisers seeking to maximize their role and ensure that, despite breaking fintech offerings vying for clients' attention and dollars, advisers will remain the best resource.
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During a recent study, Escalent asked 516 affluent consumers about the best and worst communication habits of their financial advisers. We learned how, what, when and why clients preferred to hear from their advisers regarding their investments.
How do investors prefer to be contacted? While preferences may differ across generations of investors, our research found that all clients expect the same methods of communication: phone calls, emails at home and in-person visits at their adviser's office.
As one might expect, 34% of investing millennials want to receive text messages from their financial adviser, double the rate of Gen Xers and boomers.
What do investors want to hear from their financial adviser? In general, setting, tracking and achieving financial goals are the main reasons clients seek direction and represent the most-wanted topics of discussion with an adviser.
However, 71% of millennials surveyed had a higher interest in examining their financial plan and receiving educational information about the basic preparation of a plan.
When should an adviser reach out to a client? When investors were asked what their adviser could do better, the No. 1 answer was their desire to hear from their adviser more often. Most say their adviser is communicating quarterly (41%), followed by monthly (30%), two times a year (16%) and once a year (12%).
As with many other aspects of our study, we found that preferences regarding frequency of communication differ by generation. Millennials and the silent generation want to hear from their advisers monthly, while Gen Xers prefer to communicate quarterly instead of a few times a year.
Why should financial advisers worry about their clients' communication needs? Investors hire financial advisers for their planning and strategic expertise, but the way that knowledge is shared is just as important to clients as the information itself.
Agreeing to how, what and when your clients can expect to hear from you — or vice versa — can set the stage for client satisfaction. But to really earn clients' trust and loyalty, it's imperative that advisers strive to personalize interactions for each individual relationship.
Linda York is a senior vice president in the Cogent Syndicated division of Escalent, where she leads the wealth management syndicated research and consulting practice.