So, what makes a top-notch advisor? It looks as though MainStay Investments may have given us the answer.
In its “Across Generations” survey, it found that more than 85 percent of advised investors value three specific qualities: the ability to provide meaningful advice, build trust, and attend to personal needs. And, they consider these attributes better than achieving above average returns.
Basically, this latest executive summary from MainStay Investments (the retail subsidiary of New York Life Investment Management), which is entitled “The Five Attributes of Highly Successful Financial Advisors,” shows that financial advisors should deliver more solid investment performance if they want to retain clients.
According to Chris Blunt, president of MainStay, “Investors are deciding whether they will work with a particular advisor based on factors such as trust and personal attention; quantitative metrics and product offerings are irrelevant if these ‘softer’ attributes are not there.” He adds, “Our results suggest that advisors need to rely on interpersonal and counseling skills to forge deeper relationships with their existing clients and cultivate new ones with potential clients.”
In its survey of 1,512 individuals between the ages of 27 and 83, covering four different age groups, 1,078 respondents indicated they already have an advisor or are considering working with one. They listed five attributes ranked as being “extremely important” or “very important” by more than 80 percent of these individuals, as follows:
- Tailor Your Advice: When it comes to investing, clients want advisors to weigh in with knowledgeable advice and expertise, and to refrain from taking a one-size-fits-all approach (88 percent).
- Be Trustworthy: Today’s investors want their advisors to convey a feeling of trust from the onset and work to build that trust throughout their relationship (85 percent).
- Address Personal Needs: Investors want advisors to ask about their concerns, whether they be caring for aging parents or paying for college or saving for retirement…and to address them (85 percent).
- Control Expectations: Investors expect to achieve above average returns (82 percent).
- Communicate Frequently: Investors want advisors to maintain consistent and ongoing communication, be responsive to their concerns, and demonstrate a thoughtful and genuine interest in their well-being (80 percent).
In short, the survey, says MainStay, indicates that despite his or her technical expertise or financial acumen, advisors may not be able to win new clients or retain existing accounts without an emphasis on the “high touch” communication skills that are critical to facilitating relationships. So, therefore, in the eyes of the mass affluent, successful advisors need to embrace a skill set that goes beyond just product selling and hitting the numbers.
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