Jefferson National’s Second Annual Advisor Authority Study Reveals: RIAs, Fee-Based Advisors and Investors Say Managing Volatility and Protecting Assets Top Concerns—But Advisors May Underestimate Clients’ Concerns about Healthcare Costs and Taxes

Findings Show Investors Value Holistic Planning and Fiduciary Standard—and Those Who Work with Advisors More Optimistic than Those Who Do Not

LOUISVILLE, Ky.--()--Facing challenging markets and growing uncertainty in the U.S. and abroad, Registered Investment Advisors (RIAs), fee-based advisors and individual investors cite managing volatility, protecting assets and saving for retirement among their top concerns over the next 12 months—but advisors may underestimate clients’ concerns about healthcare costs and taxes, according to Jefferson National’s second annual Advisor Authority study, conducted by Harris Poll again this year. New to this year’s survey of 683 RIAs and fee-based advisors nationwide is an expanded survey of 733 individual investors, from mass affluent to ultra-high net worth, to help advisors understand their similarities and differences so they can serve their clients more effectively.

“This year’s Advisor Authority study shows how investors struggle to manage the threats that hit their bottom line today—such as rising healthcare costs and higher taxes—while also trying to protect and grow their assets for the future,” said Mitchell H. Caplan, CEO of Jefferson National. “Increasing political and economic uncertainty, both domestically and globally, creates opportunities for expert advisors to add value and underscores the importance of working with an unbiased fee-based or fee-only advisor to ensure that clients will be better off. New to this year’s study, Advisor Authority shows where investors and advisors see eye to eye—and where they don’t—to help advisors grasp the broader trends, zero in on what matters most, and take a more holistic approach to help investors at every level achieve their long term financial goals.”

The addition of more than 700 investors is just one of the new enhancements to Jefferson National’s second annual Advisor Authority study. To complement its year-over-year benchmarking survey on the top investing, advising and practice management issues, this year’s study includes a special report that takes a 360-degree view on volatility—its causes, its impact, and defensive measures to protect against it. And again this year, Advisor Authority offers in-depth analysis on the most successful advisors and thought leaders, to provide actionable insights that can help RIAs and fee-based advisors build a more enduring practice. Highlights from Jefferson National’s 2016 Advisor Authority include:

360° View on Volatility

  • Volatility is on the rise over the next twelve months according to the vast majority of advisors (76%) and investors (63%) surveyed.
  • Advisors are more likely to revise their investing strategy in response—nearly two-thirds (62%) of advisors versus just 41 percent of investors feel pressure to take action.
  • Of those who will revise their strategy, 75 percent of advisors and 72 percent of investors plan to invest more tactically, while 69 percent of advisors and investors plan to invest more conservatively.

Bridging the Generational Divide:

  • The top three strategies being implemented by advisors to attract the next generation of investors include: working more closely with a client’s family and children (36%), increasing use of innovative techniques such as social media (36%) and mobile technology (26%), and personalized holistic advice (24%).
  • Successful advisors—those who earn more and manage more AUM—target younger prospects, and are more likely to invest in strategies to attract and retain the next generation.

Advisor and Investor Profiles: Serving the Ultra-High Net Worth

  • The ultra-high net worth say taxes are the number-one issue that will adversely impact their portfolio in the next 12 months.
  • These affluent investors place greater importance on technology, such as website enhancements, leveraging robo advice, robust cyber security and mobile access.
  • This aligns with the 2015 study which showed that the most successful advisors use more technology, are more likely to adopt robo, and more likely to use robo with affluent clients.

Transparency and Guided Advice Matter

  • More than three-fourths (77%) of RIAs and fee-based advisors will not make an investment unless they can effectively communicate the strategy to clients—or know their clients understand it.
  • When choosing an advisor, investors’ top three priorities include: experience (46%), personalized holistic advice (26%), and a fiduciary standard (24%).
  • Investors’ outlook for 2016 is apprehensive—but investors who work with advisors are far more optimistic (47%) than those who do not (35%).

“This year’s Advisor Authority study shows that RIAs, fee-based advisors and investors share many common goals, and investor optimism increases when working with an advisor. It also reveals a number of key issues that weigh on investors’ minds, providing an opportunity for advisors and their clients to more closely align on what matters most,” said Laurence Greenberg, President of Jefferson National. “As our study reveals, investors care about the issues of transparency and fees, so if an advisor does not put their clients’ best interests first, clients will find someone who does. The future is fee-based and nothing can replace holistic, unbiased and guided advice—a commitment that RIAs have been making from day one.”

To download a copy of Advisor Authority, financial professionals can visit: www.jeffnat.com/advisorauthority.

For more information, please contact Miles Hill at 212-600-2583 or miles@blissintegrated.com, or Deborah Newman at 502-587-3858 or dnewman@jeffnat.com.

Methodology

The second annual Advisory Authority Survey was conducted online within the United States by Harris Poll on behalf of Jefferson National from March 3 - 29, 2016 using a sample from the Harris Poll Panel of Financial Advisors and investors. Among the 683 Financial Advisors, there were 440 Independent Registered Investment Advisors and 243 Broker/Dealers. Among the 733 Investors, there were 167 Mass Affluent, 184 Emerging High Net Worth, 199 High Net Worth and 183 Ultra High Net Worth.

Respondents for this survey were selected from among those who have agreed to participate in Harris Poll surveys. Because the sample is based on those who were invited to participate in the Harris Poll online research panel, no estimates of theoretical sampling error can be calculated. A complete survey method, including weighting variables, is available upon request.

About Harris Poll

Over the last five decades, Harris Polls have become media staples. With comprehensive experience and precise technique in public opinion polling, along with a proven track record of uncovering consumers’ motivations and behaviors, Harris Poll has gained strong brand recognition around the world. Contact us for more information.

About Jefferson National

Jefferson National is a recognized innovator of a leading tax-advantaged investing solution for RIAs, fee-based advisors and the clients they serve. Trusted partner to a network of more than 3,500 advisors, Jefferson National provides greater efficiency, transparency and choice through an adaptable technology platform, award-winning distribution strategy and cost-effective servicing capabilities. Named the industry “Gold Standard” and winner of more than 50 industry awards, the company serves advisors and their clients nationwide through its subsidiaries Jefferson National Life Insurance Company and Jefferson National Life Insurance Company of New York. To reach our advisor support desk, please call 1-866-WHY-FLAT (1-866-949-3528). Learn more at www.jeffnat.com.

Contacts

Bliss Integrated Communication
Miles Hill, 212-600-2583
miles@blissintegrated.com
or
Jefferson National
Deborah Newman, 502-587-3858
dnewman@jeffnat.com

Contacts

Bliss Integrated Communication
Miles Hill, 212-600-2583
miles@blissintegrated.com
or
Jefferson National
Deborah Newman, 502-587-3858
dnewman@jeffnat.com