Referrals continue to dominate client acquisition strategies for financial advisors in 2025, but new research suggests the approach may not be as effective with younger investors.
The 2025 Advisor Pulse Outlook Survey from InspereX, conducted by Red Zone Marketing on behalf of InspereX, gathered responses from 829 advisors across RIAs, broker-dealers, banks, regional firms and wirehouses between May 12 and May 19.
According to the research, 76 percent of advisors said they’ve gained new clients through unsolicited referrals this year, making it by far the most productive source of new business. Referrals solicited from existing clients and those from other professionals followed, each cited by 38 percent of respondents.
Yet the report also reveals a critical disconnect between where the referrals are coming from and where future assets may be headed. Despite widespread awareness of the looming great wealth transfer, 57 percent of advisors admitted they don’t currently have relationships with their clients’ adult children.
“The power of the referral continues to drive growth for advisors,” Chris Mee, managing director and head of wholesale distribution at InspereX, said in a statement. “It says everything about the importance of service, communications, and commitment – clients appreciate it and reward their advisors with referrals.”
That might not apply in every case. A separate study released earlier this year by digital marketing firm Ficomm Partners points to shifting preferences among younger investors. According to that survey, only 17 percent of individuals under 44 required a referral to hire an advisor, compared with 60 percent of investors over 60. Meanwhile, 57 percent of younger clients selected an advisor through digital marketing, a channel only 29 percent of advisory firms currently prioritize.
That generation gap may be one reason why advisors are working harder to prove their value. When asked about their top practice challenges in 2025, 23 percent of advisors in the Insperex survey cited calming anxious clients, while another 23 percent said they are struggling to keep up with market changes. Communicating value – both to existing clients (15 percent) and prospective ones (9 percent) – also emerged as persistent hurdles.
Time management is another concern. A third of advisors reported spending most of their time proactively reaching out to clients, followed by managing portfolios (21 percent) and responding to client concerns (17 percent). Prospecting and marketing made up 15 percent of their workload, with the remaining 10 percent focused on internal planning and operations.
Mee said that the current volatile market may actually present a strategic opportunity, particularly when it comes to building multigenerational relationships.
“Periods of market volatility create an opportunity for advisors to proactively offer their expertise to the adult children of their clients,” he said. “Establishing a relationship with the next generation... could be a worthwhile investment for advisors seeking to retain assets that will be changing hands over the next two decades.”
Clients themselves appear to be adjusting their portfolio preferences in response to uncertainty. Thirty-two percent of advisors said investors are asking for more downside protection strategies, while 17 percent reported increased interest in alternatives and 14 percent are fielding more requests for access to private credit.
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