Data & Research July 14, 2011

Survey Measures Client-Adviser “Harmony”

A recent survey of U.S. consumers and financial advisers set out to measure differences in perception when looking at an adviser’s level of honesty, trustworthiness, ability to deliver results, and knowledge.  
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The Million Dollar Round Table (MDRT), an association for financial professionals, found a significant gap between how financial advisers rate themselves and how clients rate their advisers. The MDRT Financial Harmony Study looked at four attributes of advisers: honesty, trustworthiness, delivers results, and knowledge.  Consumers rank honesty (39%) and trustworthiness (29%) above delivers results (19%) and knowledge (13%) as the most important traits for advisers. However, although they agreed on the top two traits, advisers ranked trustworthiness first (41%) and honesty second (29%).

Clients gave their advisers an overall score of 7.7 out of 10 in terms of honesty while advisers gave themselves a 9.2. Advisers also rated themselves higher across all traits: trustworthiness (8.3 versus 7.6); knowledge (8.4 versus 7.8); and delivering results (8.4 versus 7.4).

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The MDRT Financial Harmony Index (FHI) Score for 2011 is 66. This index measures how consumers rated their advisers across these four important attributes; how advisers rated themselves on the same measures; and the size of the gap between the two ratings. Complete harmony between clients and advisers as well as perfect client satisfaction and adviser self-rating scores would be indicated by a score of 100. MDRT said it will track the FHI annually and work with members and the profession to better align advisers to current consumer attitudes and perceptions.

“The MDRT Financial Harmony Study should be a wake-up call for any adviser who thinks they are in perfect harmony with their clients,” said MDRT President Julian H. Good, Jr. “The findings reinforce the need for financial professionals to pay more attention to the relationship side of the adviser-client equation, working to better earn clients’ trust by demonstrating professionalism, ethics and integrity in their approach and interactions.”

The survey also uncovered differences in the harmony scores between advisers and members of various generations. “Financial harmony appears to get better with age,” said Good. “Older consumers and advisers are closer to a perfect FHI of 100 than are younger consumers.”

  • Silent Generation (ages 66-80), FHI 74
  • Boomer Generation (ages 47-65), FHI 66
  • Generation X (ages 29-46), FHI 65
  • Millennial Generation (28 and under), FHI 62

The MDRT Financial Harmony Study is based on online surveys of U.S. consumers and all financial advisers conducted by the Boomer Project and BIGresearch in April 2011. The consumer survey was conducted among 1,451 respondents, 21 to 75 years old, who currently use any financial adviser. The adviser survey was conducted among 312 financial professionals.

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