How confident are you about your firm’s ability to retain clients and attract new ones?

    As trends change and new generations come into wealth, client retention could prove to be trickier than it sounds. Research in the 2021 EY Global Wealth Research Report found that 28% of high net worth clients planned to change their wealth management provider in the next three years. 

    What’s more, many of those who are planning to swap are considering fintech platforms rather than a human adviser. Indeed, according to a Deloitte report, US robo-advisers could be managing up to $7 trillion in assets by 2025. 

    So, what are these clients drawn to in the robo-advisers they’re considering, and how could you upgrade your proposition in order to compete? Let’s take a look at three ways your firm can attract and retain high net worth clients now and in the future.  

    1. Educate and build relationships

    Of the clients expecting to switch wealth managers over the coming years, Millennials are the most likely to act. You may not have many high net worth clients in their mid-20s to their early 40s, but the next generation – Gen X, who are in their mid-40s to late 50s – are also looking to switch. And they control the near and long-term future of your business. 

    As such, education in financial literacy – something that a robo-adviser is unlikely to be able to provide – may be crucial to your future success. 

    Helping these investors to interpret the many terms and concepts that associated with wealth management is going to be crucial. What’s more, by helping them to understand the fundamental principles of financial planning, you could help them to decide whether a fintech platform or a firm such as yours is more suitable for their needs. 

    If your firm can start to build relationships with prospects and existing clients by providing regular, consistent and engaging financial education (for example through a newsletter and blog) while demonstrating your firm’s digital capabilities, you could soon reap the rewards. 

    2. Create tailored services

    Many clients expect their wealth relationships to become less face-to-face but more personal in the future. Providing a high level of face-to-face meetings isn’t the same as receiving a tailored experience where clients can interact digitally, more quickly and easily, while also having the option of a face-to-face meeting where required. The gap in this nuance is starting to grow.

    Research points to the fact that women make up a growing proportion of high net worth clients, and yet the wealth management space is largely designed for men. To survive, advice firms will need to ensure that they offer services that are specifically tailored to meet the multi-faceted needs of this changing demographic over the coming years. 

    Additionally, nearly half of clients want to consolidate all their financial activities in one place. It doesn’t matter what generational group people are in or whether they are male or female, people have become more exposed to the capabilities of technology and thus expect interaction to be easier. 

    In fact, over half of clients would be willing to pay more for better, exclusive and more reliable digital services.

    3. Make it quick and easy

    As more Gen X and Millennials inherit or create wealth, it’s becoming clear that convenience is one of their top priorities. These investors are digital natives who have grown up with next-day – or in some cases same-day – delivery of goods and are keen to see this level of convenience in all the services they use.

    And many Baby Boomers have a strong grasp of technology too, whether from the additional time they have after retirement or their children (and grandchildren) educating them on the benefits.

    This is one area where robo-advisers may seem like the ideal way for these clients to manage their wealth. They can engage with these platforms from their own homes as they complete other tasks or simply relax on the sofa. Indeed, half of high net worth individuals under the age of 40 would prefer to have 100% of their interactions with a wealth manager online than face-to-face. 

    However, it can be dangerous to generalise – it’s not just age that determines whether someone wants an online experience or face-to-face consultation. The preference can be influenced by big life events such as receiving an inheritance. When the circumstances feel overwhelming or significant, face-to-face advice has its place. 

    This shows that there is a real appetite for more digital access to financial advice, but there needs to be the option of speaking to a person as well. 

    In conclusion, by focusing on education, tailored services, and convenience, firms can position themselves competitively, appeal to a wider range of clients, and foster long-term relationships based on trust and value. 

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