Only 7% of clients loyal to adviser, AFH figures show

By Hope William-Smith

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Sep 26, 2019
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Just 7 per cent of surveyed investors are loyal to their adviser and more than three-quarters would consider switching if they felt they were not receiving value for money, according to AFH Wealth Management.

The consolidator’s survey of investors found 95 per cent do not consider switching advisers to be “a hassle” and 16 per cent do not trust their adviser at all.

AFH chief executive Alan Hudson says clarity and transparency should be advisers’ key priorities to combat this.

He says: “In order to demonstrate the value of proper advice, it is crucial that advisers understand exactly what investors want. Top of this list is honesty, be it about fees, charges or investment performance.

“We as an industry must demonstrate value and give investors confidence in the actions we take and the decisions we make.”

Despite the figures, AFH says the shift in consumer attitudes towards advice have been mostly positive since the Global Financial Crisis.

The research found a third of investors now recognise the importance of advice more than they did beforehand.

Many who do not trust their adviser admit they need their services however, while 12 per cent say they are more involved in their financial decision-making than they otherwise would be because of their lack of trust.

Hudson says: “As investors become increasingly discerning with a greater propensity to switch advisers, and as new models enter the market, the value and effectiveness of face-to-face advice will continue to be challenged.”

A total 41 per cent of investor respondents to the research say their adviser’s familiarity with their situation is what gives them confidence in the financial planning services sector generally.

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