In Practice August 7, 2009

Advisers Offer More Services than Clients Use

While most advisers offer employer benefits retirement planning services, only a quarter of clients use those services, according to research from Cerulli Associates.

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Across all channels, 71% of advisers offer employer benefits retirement planning, according to the latest issue of The Cerulli Edge—Advisor Edition. A breakdown of advisers by channel shows the following:

  • bank: 66% offer employer benefits retirement planning
  • wirehouse: 67%
  • regional: 67%
  • insurance: 76%
  • independent broker/dealer (IBD): 74%
  • dually registered: 74%
  • registered investment adviser (RIA): 68%.

While the rise of fee-based services has helped broker/dealers and advisers offer a wider array of services incorporating basic financial planning, many clients are not using those services, according to Cerulli. Across all channels, 25% of clients use employee benefits services. A breakdown by channel shows the following:

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  • bank: 16% of clients receive employee benefits retirement planning services
  • wirehouse: 21%
  • regional: 20%
  • insurance: 32%
  • IBD: 27%
  • dually registered: 28%
  • RIA: 27%

The results are similar for other services advisers offer. While asset allocation is offered by almost all (98%) of advisers, 78% of clients actually receive that service. Going through the other top services shows similar results: retirement income planning (94% offer but 59% of clients receive the service); retirement accumulation planning (93% versus 52%); insurance (87% versus 46%); estate planning (85% versus 37%); and education funding (83% versus 31%).

Some of the discrepancy between services offered and the services clients received can be attributable to lack of client need for some services, but much is also attributable to advisers not feeling totally comfortable with various topics, according to the report. One implication is that broker/dealers should make sure advisers are familiar and comfortable delivering all service options, Cerulli says.

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