A recent survey from Herbers & Co revealed five primary reasons that folks don’t hire financial advisors. Topping the list, 52 percent of U.S. respondents with $250,000 or more of investable assets said they desire independence in managing their finances. While this group is less likely to be swayed by a sales meeting, that still leaves 48 percent of respondents who cited other reasons that could leave the door open for the right advisor.
Other reasons cited included: uncertainty around the quality of advice offered; a lack of perceived need for an advisor; misaligned values with advisors they’ve met in the past; the perception that their financial situation will be judged, and a lack of time to adequately find and vet an advisor.
Interestingly, age, gender and asset levels all played a role in the breakdown of rationales provided, with quality of advice concerns soaring among the 35-64 age group and the desire for independence increasing with age. Women were more likely than men to report values-based concerns and in the higher wealth groups, the lack of a perceived need for advice ($2.6-6M) and concerns about the quality of advice ($6M and over) topped the reasons given for not using a financial advisor.
The good news for advisors is that a large portion of wealthy Americans who do not currently have a financial advisor may not be opposed if they can find “the right one.” The downside, however, is that beyond the work involved in identifying these folks and distinguishing whether the rationale driving their decision is surmountable, there is a sizeable portion who simply prefer managing their finances independently. Asking about this preference early in your prospecting process may save a little time and heartache further along in your sales cycle.
Christy Charise, Founder & CEO of Strategic Advisor
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