High net worth clients act as advice predictors
Financial planners should engage with high net worth clients as they provide an indicator of future advice and product trends as well as an untapped market segment.
BT Financial Group (BTFG) Queensland regional manager for platforms Jason Brown said there was about 400,000 high net worth investors in Australia with a quarter of that number not receiving any form of financial advice.
Brown, speaking at the Associated Advisory Practices conference in New Zealand, said that high net worth clients were good indicators of advice and product trends.
He said that based on a range of surveys conducted by Investment Trends and commissioned by BTFG high net worth investors led the wider advice market in terms of their demands for investments and advice to access these investments.
"They are usually better informed and have more sources of information available to them and are more disciplined in their approach to investing as well," Brown said.
According to Brown high net worth investors control about $1.4 trillion in investable assets paying $1.8 billion in fees to planners.
However a quarter of high net worth investors do not receive any form of advice with half of that number, or about 50,000 stating they had unmet advice needs.
"These people are willing to pay $75 million to plug the gaps in their advice needs, particularly around estate planning, inheritance and family succession planning," Brown said.
"While only 10 per cent of this group want full scale advice, 80 per cent are seeking piece by piece advice and are happy to pay an average of $2500 per piece of advice."
Jason Spits travelled to the 2014 Associated Advisory Practices conference in Queenstown, New Zealand as a guest of AAP.
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Jason Spits
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