Financial advisors are shifting from cost cutting to growing their businesses and taking on new employees, according to polling by Fidelity Investments.
Surveys of attendees at Fidelity's two-day Executive Forum in April found that only 2% of respondents said cutting cost would be their biggest driver of profitability this year. That's down from 27% just a year ago.
The survey instead found a larger number of advisors looking to grow their businesses in 2010. Eighty-six percent of respondents said they would achieve growth and profitability this year by taking on new clients, as well as new advisors and brokers. That's up from 63% a year ago.
More than 375 client firms of National Financial and Fidelity Institutional Wealth Services attended the forum, with an average of 186 advisors answering each survey question.
"After 18 months of cutting costs, broker-dealers and RIAs have clearly shifted their attention to accelerating growth through acquisition," said Michael R. Durbin, president of Fidelity Institutional Wealth Services. "Not only are firms aggressively recruiting top producing brokers and advisors, but they are focused on actively wooing affluent investors away from the large wirehouse firms, while expanding relationships with existing clients."
Among the survey's other findings:
Fifty-two percent of advisors believe their clients' biggest concerns are outliving their retirement savings, followed by recovering from the financial crisis (35%).
Forty-seven percent believe client acquisition and retention will be their biggest business concerns in 2010.
Sixty-four percent do not expect the S&P 500 to return to its October 2007 high of 1,576 until after 2012.
Fifty-three percent believe the national debt is the biggest issue facing the U.S. economy in 2010, while 41% believe the top economic issues is unemployment.