FUTUREWEALTH 2015: RECALIBRATING VALUE IN WEALTH

Report summary

Value is by nature an enigmatic concept.  What makes it challenging is that it is entirely subjective and therefore hard to define, measure and regulate.  Historically, wealth managers have not prioritised value on the proviso that high net worth individuals are not price sensitive.

Our latest HNW research proves that this assumption is inaccurate.  We discover that the Futurewealthy - and particularly the ultra-high-net-worth - are hoping to recalibrate value from their wealth management firms by moving away from traditional fee structures - especially the percentage fee.

This final report in the Futurewealth 2015 series investigates the concept of value in the context of wealth management.  We ask the world's wealthy whether they feel their firms deliver good value for money and how they perceive the fee they pay for their advisory services.

Key Findings

  • 77% of the Futurewealthy feel that their wealth management firm offers good value for money, rising to 85% among those who hold more than 75% of their assets at the firm.
  • Most clients who rate their provider as 'very good' also agree that they offer good value for money.
  • On average, HNW clients believe the relationship manager delivers the greatest value within their wealth management experience and would assign 36% of their fee to their relationship manager.
  • The futurewealthy anticipate a shift in the way they pay for advisory services in the future.  While 31% of them currently pay using a percentage fee on the assets held under advice, just 26% would like to continue with this structure in the future.
  • The biggest shift in fee preferences are among the wealthiest investors.

Futurewealth 2015

Futurewealth 2015, a HNW research project now in its sixth year, is an exploration of the attitudes, needs and preferences of HNW clients around the world.  We are extremely grateful for the 3,113 wealth investors who shared their views during this year's HNW survey.

Our objective this year was to explore every aspect of a HNW client's interaction with their relationship manager.  The result is four papers that together offer an unrivalled view of what it takes to serve wealthy individuals well.

Download copies of the remaining reports in the 2015 Futurewealth series:

Paper 1:  The art and science of relationship management

Where does the relationship manager sit within the wealth management operating model?

Paper 2:  Hanging in the balance: Conversations with the Futurewealthy

How do HNW clients feel about engaging with their wealth managers?  How often do they interact with a financial advisor and who do they want to hear from, when and about what?

Paper 3:  Generation sceptic: Meeting the millennial standard

To what extent do high-net-worth individuals feel that the wealth management industry is implementing appropriate business standards to deliver on key outcomes.  How does the engagement style of the next generation shape its perception of service delivery?

Audience

Wealth managers, private banks, family offices, financial advisors, investment offices.

Research process

This is the sixth year of our Futurewealth research series. The report findings are based on the views of 3,113 individuals from around the world with an average worth of US$2.7 million. We refer to them as the Futurewealthy because they are at the front of a global charge up the wealth curve.

Futurewealth is a global customer insight programme that examines wealth management trends and the thoughts, needs and aspirations of HNW investors. In 2009, when many in the industry didn’t believe that it was possible to survey wealthy clients in statistically valid numbers, Scorpio Partnership began this attitudinal research programme. Today, over 15,000 HNWs have taken part and their input has created a database of over 5 million segmentable data points.

This wealth management research was conducted using an online survey.  Participants were identified using profiling techniques to determine their likelihood of qualifying as Futurewealthy candidates.  They were contacted directly by email.

Genre

HNW Research

Publisher

Scorpio Partnership, SEI (NASDAQ: SEIC), NPG Wealth Management

To read and download other client experience (CX) reports visit our Knowledge bank.