A recent survey by CapIntel, a B2B fintech firm, sheds light on what investors prioritize in their relationships with financial advisors and the key factors that drive them to seek new representation. According to ThinkAdvisor, the survey confirmed industry assumptions, it also highlighted areas for improvement. Investors identified five primary reasons they would seek a new advisor, offering insights into how advisors can strengthen client relationships and reduce attrition.

Loss of Trust

Trustworthiness ranks as the most critical quality investors seek in an advisor, with 70 percent citing its importance. Even when an investor chooses an advisor based on a trusted recommendation, maintaining that trust is the advisor's responsibility. Providing accurate information, demonstrating a clear understanding of client goals, and offering personalized advice are essential. ThinkAdvisor notes that advisors can reinforce trust by involving clients in the planning process and ensuring transparency.

Poor Investment Performance Relative to Expectations

Investment performance is a major factor in client satisfaction, with 54 percent of respondents indicating they would leave an advisor if their investments underperformed. However, strong client relationships can withstand market fluctuations when advisors take a comprehensive approach, considering the client's full financial picture, setting clear expectations, discussing risks thoroughly, and maintaining consistent communication, particularly during periods of market volatility.

Ineffective Communication

Clear communication is crucial to investor confidence, yet only 62 percent of clients rate their advisor as excellent in this area. Meanwhile, 85 percent of investors expect their advisors to provide a comprehensive understanding of their financial health. Poor communication leads 46 percent of clients to consider leaving their advisor. To prevent this, advisors must provide regular portfolio updates, simplify complex financial concepts, and ensure clients feel informed and engaged.

Subpar Client Experience

Nearly 45 percent of investors would leave an advisor due to a poor client experience. A positive experience often starts with a tailored investment proposal—90 percent of investors expect personalized recommendations. Advisors must also respect client communication preferences, with most investors favoring phone or in-person meetings. While traditional documentation remains common, millennials increasingly prefer interactive digital dashboards that offer real-time updates and customization.

Lack of Availability

Clients expect their advisors to be accessible, especially during market downturns or significant life changes. Investors value timely responses, and 50 percent desire real-time communication for portfolio adjustments. Advisors who are not readily available risk losing clients, as 42 percent of respondents stated they would leave an advisor due to lack of responsiveness.

ThinkAdvisor reports that advisors who prioritize these factors can improve retention, build deeper trust, and enhance their overall client service. As investor expectations evolve, advisors must adapt to meet their clients' needs and deliver exceptional value.

Financial Advisor Transitions consults advisors nationwide to explore employment transition options and to preserve and protect their practice in any transition that they make.