In PracticeJanuary 21, 2015

Fiduciary Insights Can Boost Practice Performance

Learning about fiduciary best practices can help financial advisers build client trust and raise assets, according to a survey by fi360.

Reported by John Manganaro

The survey shows nearly three-quarters (71%) advisers feel formal education around fiduciary standards has helped them become better investment industry practitioners. In addition, 48% said proactive fiduciary training created a greater sense of trustworthiness among clients, and 31% said it enhanced their reputations.

Approximately four in five advisers in the sample, taken from fi360’s advisory client base, have pursued the accredited investment fiduciary (AIF) and accredited investment fiduciary analyst (AIFA) designations to further their professional development. The two designations are offered by the fi360 Center for Fiduciary Studies and are intended to provide recipients with the knowledge and tools to administer a prudent investment process grounded in industry best practices, fi360 notes.

Other survey results show close to 60% of respondents said their assets under management or advisement increased “significantly” or “somewhat” within a year after receiving the AIF or AIFA designation. More than a third (36%) attributed those changes directly to the designation. Other leading factors for asset increase include the economy (51%) and clients’ financial situations (44%).

Looking to 2015, surveyed financial advisers reported their top goals for the year include increasing the size of their client base (57%), increasing the size of their typical accounts (46%), and ramping up marketing efforts, such as advertising and public relations (39%). More than three in five advisers (62%) said that they would like to serve more retirement plans, and 47% will aim to serve more wealthy individuals and families.

Advisers ranked new business development as their biggest challenge for 2015, fi360 says, followed by marketing, client relationship management, compliance and regulation, and succession planning, in descending order.

“Advisers are constantly and rigorously searching for ways to grow their businesses, whether by expanding their client base or serving more corporate retirement plans,” notes Blaine Aikin, CEO of fi360. “This study helps illustrate that educated advisers who understand fiduciary best practices are better positioned to realize this growth, raise tangible assets, and meet their top challenges.”

The results of this survey were compiled from a randomized selection of fi360’s clients, polled online in November and December of 2014. More information on the survey and other fi360 research is available at www.fi360.com.