The latest research from Cerulli Associates, “The Cerulli
Edge – U.S. Edition, January 2017 Issue,” shows investors in the U.S. express a greater willingness than ever to pay for financial advice.
“In 2008, 40% of respondents indicated that they were
interested in paying for advice; by 3Q 2016, the percent grew to 50%,” says Scott
Smith, director at Cerulli.
Matching other recent research showing an inversion in the advisory client base, Cerulli finds the desire to
pay for advice has “a high correlation with investor wealth and a less robust
inverse correlation with investor age … Investors
under age 40 express the greatest keenness to pay for financial advice.”
“Investors express an increased interest in paying for the
financial advice they receive,” Smith adds. "However, the market has yet
to fully embrace their preferences or expectations. To capture marketshare,
providers will need to better understand investor preferences about their
According to Cerulli, with the rapid growth of digital
retailers, traditional wealth management providers must assess the
vulnerability of their business models.
“Digital options have become part of the landscape, but
consumers facing complex decision processes repeatedly choose to include humans
in their service selections. A belief in the trustworthiness and expertise of
providers is a crucial element of these relationships,” Smith continues.
“Amid the shifting advice landscape, traditional firms need to deliver value in their relationships in order to compete
with digital advice providers,” he concludes. “The rise of digital advice shows that investors
are frustrated by the current state of financial advice.”
More information on obtaining this and other Cerulli reports
is available here.