Clients' sense of security 'most important'

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Advisers are being told that giving their clients peace of mind may be more important than the investment returns they provide.

Tuesday, October 3rd 2017, 6:00AM 2 Comments

by Susan Edmunds

Dave Butler, co-chief executive, Dimensional Fund Advisers

Dimensional Fund Advisers surveyed 19,000 investors, including in New Zealand, to ask what they valued in their relationships with their financial advisers.

It found they rated as most important the sense of security they received, their financial adviser's knowledge of their financial situation and progress towards their goals. These all ranked ahead of their investment returns.

Dimensional co-chief executive Dave Butler said while returns mattered, having a plan and staying disciplined was just as important for long-term success. Advisers helped that goal by setting the right expectations.

"When investors work with an adviser who has a holistic understanding of their personal situation and can help them stay focused on their long-term goals, we believe they are better positioned to benefit from what the capital markets have to offer."

Asked what was most important about their advisers, more than half the respondents said the client service experience and their adviser's experience with similar clients.

Sense of security was the most important single attribute, most valued by 35%, followed by knowledge of the client's personal situation at 23% and progress towards goals at 20%.

Investors had similar views the world over.

Adviser Stephen O'Connor said the results were unsurprising. "I would expect the same response if my clients were surveyed."

But another, Rodger Spiller, said the result highlighted some of the keys to successful client relationships.

"Many people may consider investment returns as most important. However this survey highlights that clients of advisers are really looking at their money and their relationship with their adviser in terms of the value of increased peace of mind that can come from a wise Money Doctor who has diagnosed and continues to know their situation and supports them in progressing towards their goals," he said.

"This type of trust-based relationship and sense of security can make a big difference in helping investors to maintain their discipline and achieve better long-term returns and progress towards their goals."

Tags: financial advisers investment

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