Wealth management and the web 'like oil and water': Study

Investors want more online communication with their financial advisers about their portfolios and financial circumstances, but apparently, they're not getting their way. “Wealth management and the Internet today are like oil and water," a new study from SEI’s Global Wealth Services unit noted. "Separately, they look compatible, but in reality, there needs to be a powerful outside force to make them come together.” Investor demand should be that outside force. The study considered the opinions of wealth managers at 50 firms and 200 individual investors, and found dramatic differences in what kinds of communications they value and consider most important. Ninety two percent of advisers, for example, believe that face-to face meetings are the most important form of communication with their clients. Just 4% said online communication is critical, and only a third said e-mail communication is a priority. Investors, on the other hand, want to more of their financial planning virtually. Indeed, fully 82% of those surveyed said they want access to their financial statements online, and half of them said they want their wealth management firms to upgrade their systems to enable more interactive communication with their advisers. There is a generational dynamic at play, with younger investors wanting more online communication and older investors still comfortable with more traditional forms of communication, said SEI senior vice president Jim Morris. However, the market has crossed the tipping point on things like online access to account information and accessing accounts from mobile devices. “Wealth managers need to think about where the ball will be — not just where it is now,” Mr. Morris said. “As assets transfer to the next generation, firms have to consider how best to serve these clients.” It won’t come cheap, at least in the short term. But Mr. Morris suggested that wealth managers who fail to broaden their capabilities to communicate with their clients risk losing them. “The quarterly statements and the annual meeting is just not enough anymore,” Mr. Morris said. “The smart firms are adopting a diverse set of communication strategies, from face-to-face meetings to online, to phone and snail mail. Their clients can determine their preferences, and the firms can determine pricing policies for the services.”