How to Boost Client Confidence, According to Research

Even when clients say they are satisfied with their advisor, there’s no certainty they are confident about their financial future.

This finding comes from a 2023 study of 1,000 clients and prospects conducted by Absolute Engagement, a research firm that focuses on overlooked advisor opportunities: Only 53% of respondents are confident that they’ll reach their financial goals.

The implication?

“It’s a leading indicator of risk in the relationship,” Julie Littlechild, founder and CEO of Absolute Engagement, tells ThinkAdvisor in an interview.

The survey, developed with the Investments & Wealth Institute, identifies areas where financial advisors can add value.

For instance, “Advisors need to get inside the hearts and minds of clients in a more robust way” to “personalize the relationship,” argues Littlechild, winner of a 2023 ThinkAdvisor Luminaries award for financial and investment innovation.

In the interview, Littlechild notes that advisors best talk with clients about more than numbers. “The data is leading us down the path of advisors leaning into non-financial issues,” she says.

Here are highlights of our conversation:

THINKADVISOR: How happy are clients with their financial advisors, according to your 2023 survey? 

JULIE LITTLECHILD: They’re happy. But for some clients, when they look forward, they have softer confidence — maybe not as much confidence that they’ll reach their goals.

What’s the significance?

That’s a leading indicator of dissatisfaction. Because it’s correlated with things like satisfaction and loyalty, it’s a leading indicator of risk in the relationship.

Our confidence index reflects the client’s sense of financial security and confidence that they’ll reach their goals, their sense of control over reaching those goals and clarity about the future. 

So some are [essentially] saying, “I might not be dissatisfied right now, but I might be in the future.”

How can the advisor turn this low confidence into something positive?

It’s an opportunity to talk to their clients and work through those issues.

This is 2024, not 1994. Should advisors be doing something different in their general approach to helping clients? 

They need to get inside the hearts and minds of clients in a more robust way, not just ask them, “How are things?” but teasing out what their concerns are and being a bit more scientific about how they do that. 

We’re in favor of having more and better data on how clients are feeling and what they need. 

Advisors can use that information to personalize the relationship, moving from generic communication to communication that reflects clients’ specific needs and concerns.

In your report, “Beyond Satisfaction,” you asked how clients were feeling when they thought about the future, the kind of support they need, what’s keeping them up at night. What did the responses reveal? 

Since the onset of COVID, we really started going deeper into not just what a client expects and what their [investment] performance is but how they’re feeling. 

Almost equally as important as having money was having good health and spending time with family. 

A lot of clients said it would be helpful if their advisor could help them think through those goals.

Why don’t they?

Many clients that were surveyed said they didn’t share that [sort of information] with their advisors.