For many financial advisers, conducting face-to-face meetings has been a crucial part of their service. It also goes without saying that these meetings have all but ceased in 2020, but new research suggests that Covid-19 will deliver long-term changes to the way many advisers service their clients.
In a survey by asset manager Schroders, advisers were asked how they would conduct their client meetings if life was able to return to normal in 2021. Only 6% of respondents said they would conduct all of their meetings face-to-face in these circumstances, with a clear majority (60%) saying they would be likely to have an even balance of face-to-face and virtual meetings.
When asked to name their three biggest areas of concern, 84% of the advisers surveyed mentioned regulatory issues. 46% listed professional indemnity insurance and 45% mentioned finding new clients.
78% viewed the impact of wealth transfer between generations as an opportunity for their business. However, only 21% said they had a defined strategy for targeting younger customers.
71% of respondents said they expected little change in UK base interest rates.
As many as 74% of respondents said they now considered ESG (Environmental, Social and Governance) issues in their fund selection process, representing a significant rise from the 43% figure in the 2019 survey. 52% think that coronavirus will change client attitudes to sustainable investing.
The survey found that, over the last 12 months, advisers have become more likely to recommend that their clients invest in developed international equities, emerging markets and alternative investments. They are now less likely to recommend UK equities, government bonds and corporate bonds.
The Schroders UK Financial Adviser Survey was conducted in early November 2020 and was completed by 125 financial advisers.
Gillian Hepburn, Intermediary Solutions Director at Schroders, commented on the intergenerational challenge issues by saying:
“Despite financial advisers continuing to agree that wealth transfer is a significant opportunity, the average age of clients remains high. The requirement minimum levels of investment are also increasing with very few advisers delivering a proposition for younger investors.
“At a time when financial advisers are reporting that finding new clients is one of their main challenges and with Covid-19 contributing to this, potentially some of these new clients are already within the next generation of their existing client bank. Perhaps of greater concern should be divorced or widowed clients where less than 10% of advisers have a differentiated proposition and there is the potential to lose assets as significant numbers of these women change their adviser at the points of wealth transfer.”
The information shown in this article was correct at the time of publication. Articles are not routinely reviewed by Scott Robert and as such are not updated. Please be aware of the facts, circumstances or legal position may change after publication of the article