Win the wealthy clients of the future

By Staff | March 8, 2017 | Last updated on March 8, 2017
3 min read

If you’re trying to win more high-net-worth (HNW) clients, you’ve got your work cut out for you.

That’s because their reasons for not working with you are daunting. A CFA study finds that wealthy people:

  • prefer to make their own investment decisions (60%),
  • believe the cost of advisors is too expensive (40%) and
  • question whether advisors act in their best interests (32%).

However, despite citing preference for the DIY approach, 75% of wealthy people use advisors.

But, of the wealthy who are under age 35, a full third say they seek advice at a bank.

With a radical wealth transfer set to occur between generations, appealing to more millennials is essential for advisors.

Read: Get your HNW client out of legacy limbo

To that end, the study identifies a new era in advisory services — the “Age of Engagement” — where the customer is king. For advisors, thriving means considering the value offered to each customer and marketing those offerings effectively.

For instance, the study finds that clients — especially younger ones — want to see demonstrable expertise across a range of technical products. Hedge funds, private equity and sustainable investing emerge as areas where clients believe their advisors must be highly proficient.

You only want me for my tech?

Further, more than half of the wealthy surveyed say the value of an advisor lies in the strength and breadth of digital offerings made available to clients. And, not surprisingly, digital offerings are cited more frequently by millennials.

Read: Robo-advisors trying to build trust for likely market correction

But most advisors surveyed see their value in being accessible to clients at any time.

Says the study: “It will be those advisers who have the flexibility to work alongside new technologies, as well as technical expertise and emotional intelligence to add value beyond them, who will deliver successful client relationships in the future.”

Qualities of a successful advisor

  • Emotional intelligence

Advisors demonstrate emotional intelligence by investing in a solid grounding of behavioural finance, says the study. Beyond building relationships and listening carefully, that means navigating the behavioral impulses and cognitive biases that lead clients to deviate from sound wealth strategies.

  • Top qualifications

More than 60% of wealthy people surveyed say wealth firms can demonstrate responsibility through the professional qualifications of their advisers. However, the various designations confound investors, so advisors must help clients understand which designations represent premium advisors.

The study finds more than half of wealthy investors will ascribe greater significance to an adviser’s designation in years to come. That rises to 90% for those under the age of 35.

  • A total experience

Further, those top qualifications will be needed to provide what the study calls a total client experience.

“Private investors of the future will place greater emphasis on the proactivity of their advisers when it comes to making investment recommendations and managing risks,” says the study. “They value an adviser who can assess the whole landscape and determine the spectrum of opportunities and threats that could influence [clients’] wealth creation.”

That’s especially true for millennial clients. Beyond returns and in addition to digital access, millennials want customized reporting, sustainable investment techniques and a demonstration of the advisor-client relationship in cash terms.

You can read the study, with an advisor focus, here. The study’s report on investors is here.

About the study: The CFA Institute and Scorpio Partnership completed the research from July 2016 to December 2016. Survey participants comprised 892 CFA charterholders and 478 other wealth advisors, as well as 4,000 mass affluent and high-net-worth individuals living in Canada and the U.S. with a mean net worth of US$7 million.

Also read: How to stay relevant in the age of robos staff


The staff of have been covering news for financial advisors since 1998.