In a year of stock market volatility, shaken affluent investors are taking it upon themselves to conduct more independent financial research.
In an investor survey conducted last September by Millionaire Corner, households with a net worth between $500,000 and $1 million (not including primary residence) were most likely to say they would not be relying more on an advisor (40.5 percent) and instead be conducting their own research.
Across the wealth levels, a higher percentage of those with a net worth between $100,000 and $1 million do not consult a financial advisor. Thirty-eight percent of these households identify themselves as self-directed investors, compared with 28 percent of Millionaire households and 27 percent of Ultra High Net Worth Households with between $5 million and $4.9 million.
The Mass Affluent are typically younger and are earlier adopters of new technology. They are more likely, for example, to pay their bills online than their wealthier counterparts. But use of the Internet for personal finance activities and information generally increases with wealth. Seventy-nine percent of the Mass Affluent use the Internet to conduct investment research, compared with 82 percent of Millionaires and 86 percent of the UHNW.
Millionaires, though, are the most likely to use the Internet to conduct investment trading, while the wealthiest households, which tend to be older and less tech-savvy (and are more apt to rely on brokers), are the least likely.
As wealthier households are more likely to work with brokers or a financial adviser, they are most likely to log on to the Internet to evaluate capabilities of financial service firms. Likewise, use of the Internet for financial goal planning increases with wealth level. Sixty-three percent of the Mass Affluent use the Internet for this purpose compared with 74 percent of the UHNW.
A greater percentage of UHNW also use the Internet to correspond with their advisor (80 percent) than do the Mass Affluent (54 percent).
Not surprisingly, the wealthiest households would most like to see their financial advisor expand their website’s offerings to include articles or research on financial topics and products (63 percent), comprehensive service or product information (50 percent), and benchmarking against investment returns (51 percent),