Communication is as important, if not more so, than investment track record when high net worth investors consider financial advisors.
High net worth investors are very clear as to the qualities they want from their financial advisor.
Oddly, less than half state their faith in the quality of the industry of financial advisors as a whole.
Spectrem’s quarterly report – Advisor Relationships and Changing Advice Requirements – studied Ultra High Net Worth investors with a net worth between $5 million and $25 million. To begin with, those investors were asked to agree or disagree with the statement “I feel that most financial advisors are very professional and knowledgeable.”
Only 48 percent agreed that most financial advisors are professional and knowledgeable.
Of course, they tend to believe their own personal advisor has those necessary qualities for providing beneficial advice.
Ninety-six percent of UHNW investors expect financial advisors to be honest and trustworthy. Ninety-four percent want an advisor who operates transparently and keeps the investor informed as to what they are doing.
Eighty-nine percent of UNHW investors consider the investment track record of the advisor as a key factor in working with him.
Sixty-three percent of investors want an advisor who is associated with a well-known brand, and 63 percent also want an advisor who comes with a strong referral from someone who is trusted.
As the reading material suggests, all investment comes with risk, and 90 percent of UHNW investors want an advisor who understands the appropriate appetite for risk.
Ninety-two percent want an advisor who responds promptly to requests for information, and 55 percent want an advisor who makes contact on a regular basis, although investors disagree on just what constitutes “regular basis”.
Less than half (47 percent) of investors rate their advisor on how recommended investments perform in relation to the market.
Almost 70 percent of investors want their advisor to have registrations and certifications that indicate training and study.
Kent McDill is a staff writer for Millionaire Corner. McDill spent 30 years as a sports writer, working for United Press International and the Daily Herald of Arlington Heights, Ill. From 1988-1999, he covered the Chicago Bulls for the Daily Herald, traveling with them every day through the nine-month season. He also covered the Bulls for UPI from 1985-88, and currently covers the team for www.nba.com. He has written two books on the Bulls, including the new title “100 Things Bulls Fans Should Know And Do Before They Die’, published by Triumph Books. In August 2013, his new book “100 Things Bears Fans Should Know And Do Before They Die” gets published.
In 2008, he resigned from the Herald and became a freelance writer. The Herald hired him to write business features and speeches for the Daily Herald Business Conferences and Awards presentations.
McDill also writes a monthly parenting column for the Herald’s Suburban Parent magazine.
McDill is the father of four children, and an active fan of soccer, Jimmy Buffett and all things Disney.