Independent investors consider themselves self-reliant; however, one in five finds value in human advice, according to The Cerulli Report—U.S. Retail Investor Products and Platforms 2024.
According to Cerulli Research, 22% state that it is important to be able to speak with a human specialist linked to their account, and another 33% say it is somewhat important to have this capability.
To convert these investors into formally advised clients, wealth management providers must successfully guide clients through their platform with targeted customer service offerings while removing key friction points between a client’s desire for greater financial advice and the platform’s ability to connect them with advisors who can provide it.
Apart from the importance of speaking with a human specialist, the majority are willing to pay for that privilege: 42% state that they would pay, at least to some extent, to speak with a human specialist.
Younger investors, who are the most inexperienced with self-directed investment accounts, are the most likely to offer to pay for periodic advice, with one in five stating it is very likely they would do so.
However, despite the high demand for human advice within self-directed platforms, only 39% of respondents have ever consulted an advisor.
Those with less than one million dollars in investable assets and those under 30 are the least likely to opt for this service. Low adoption is a significant hurdle for providers seeking to use human interactions as a foothold for more extensive financial advice delivery.
To facilitate this transition, platform providers must ensure that clients can easily contact specialists with questions as needs arise to foster relationship development.
“If a full-service provider’s goal in offering self-directed brokerage accounts is for those clients to eventually engage in advisory relationships, they must make those interpersonal services visible to these clients,” says John McKenna, analyst.
In this regard, McKenna emphasizes the importance of financial education.
“Early awareness, through targeted email campaigns and milestone notifications, can drive this awareness. With this increased awareness, clients are more likely to stay with the firm for future financial advice,” he added.
For large firms with multiple lines of business, the path to closer engagement can be very efficient if the walls between units are lowered.
“By identifying moments of greatest need, transitioning clients toward more advised relationships can lead to increased wallet share and a more harmonious one-stop-shop for all financial needs, creating loyal clients for decades,” concluded the analyst.
