Advisors are more likely to keep their clients and gain new ones if they provide a holistic view of their clients' finances, prepare a comprehensive report of finances, keep their websites up to date and ask their current clients for referrals to new ones, according to a new survey.
The survey from ByAllAccounts and Paladin Registry of Financial Professionals asked 195 investors what would make them stay with their current advisor. It also asked about making referrals.
Some clients say they feel uncomfortable making referrals (27.4%), but almost as many (25.8%) say their advisor has never asked them for referrals. At the same time, 46% of investors say they found their advisors through a referral from a friend, respected associate, CPA or attorney. Another 24% say they found their advisor by conducting an Internet search.
More advisors are providing a holistic view of their clients' assets, including 401(k)s, pensions, IRAs, trusts, annuities and taxable savings accounts. These are the advisors who are most likely to receive the highest ratings and are more likely to be retained, according to the survey.
More than 60% of advisors now provide a holistic view of their clients' finances and about the same number (64.3%) produce a consolidated statement of all assets. Indeed, the survey found those advisors who provide a holistic view are rated as giving higher levels of service in a host of categories such as producing a consolidated statement, helping allocate assets, helping develop retirement and estate plans, and providing tax efficient investment strategies.
Of those investors receiving a holistic view of their finances, more than 90% are somewhat or very satisfied with their advisors. Of those not receiving a holistic view, 69% said they are satisfied.
When asked the probability of firing their advisor in the upcoming year, 54% of those receiving a holistic view said there was no chance they will fire their advisor in the next 12 months. At the same time, 46% of people who didn't receive a holistic approach say there is a 50% chance or better they will fire their advisors within the next year.
"Advisors with a 0% chance of termination provide a higher level of service" from a number of aspects, including helping to allocate investments, providing investment advice on accounts that are directed by the investor and providing money management services, the survey says.
The survey results show advisors should ask for referrals, create an online presence so investors can find them and provide a holistic view of assets for their clients.