Since 2009, investors have become increasingly dependent on
financial advisors. According to TNS' Affluent Market Research
Program, this marks a shift in mindset from the years before the
Great Recession, when the trend was toward greater
self-reliance. In 2014, 24% said they relied on an advisor to
make most or all of their investment decisions, up from 17% in
The percentage of investors who said they make their own
decisions without the help of an advisor is likewise down, from 33%
in 2009 to 29% in 2014. The TNS Affluent Market Research Program is
a market insights service for financial firms who serve the
investments and banking needs of affluent individuals.
The opportunity for financial planning.
- 33% of investors made all their own decisions in 2009
- 29% of investors made all their own decisions in 2014
Investors generally are more dependent on advisors when they are
older. But they establish durable, long-lasting relationships
when they are young. Financial planning presents an
opportunity to establish advice-oriented relationships
early. The greatest unmet demand for financial planning is
among investors under age 55. For example, whereas about 40%
of adults age 18 to 34 have a financial plan, another 40% say they
don't have a plan but are interested in getting one.
Fidelity Investments. Though it earns
satisfaction scores in line with industry averages, Fidelity
manages to achieve better than average client retention. A
strong brand, supported by high advertising recall, supports
Fidelity's positive competitive momentum.
Vanguard. Vanguard is achieving organic market
share growth despite only average performance attracting new
clients. Its momentum reflects exceptionally good client
retention. The Vanguard brand is more highly regarded than any
major investments brand in the industry, and is distinguished by
its reputation for superior value, dependable service, and
straightforward product offerings.
Edward Jones. Edward Jones has achieved
impressive competitive momentum in recent years by attracting
clients with more modest levels of assets and growing these
relationships to higher levels of affluence. The company offers a
superior client experience, earns high satisfaction scores, and is
rewarded with superior client retention. Its physical distribution
network and strong advisor relationships are keys to its
Wells Fargo Advisors. Among leading
bank-affiliated providers, Wells Fargo has had the strongest
organic growth in recent years. It is quite successful stealing
advisor-dependent clients with substantial assets away from other
providers, especially firms with full-service brokerage histories.
Wells Fargo Advisors earns unremarkable overall satisfaction
scores, and below-average marks for investment performance. But
clients give high ratings to their advisors, who they perceive as
easy to work with, and who make the effort to know them.
Scottrade. Superior client retention has
yielded strong organic growth for Scottrade. Clients give the
company high marks for its website and online investing tools, for
its physical offices, and for good value.