A survey of wealth management clients carried out by findawealthmanager.com found that 15% of respondents who are unsatisfied with their wealth manager listed fees as the cause, up from 9% in the same survey a year ago.
One issue which could be driving this is M&A in the sector, says findawealthmanager.com’s Lee Goggins. “M&A deals continue to come thick and fast, and they can often prompt clients to start exploring their options – particularly if they’ve had a poor experience in the past,” he said. “The fact that fees sometimes go up compounds the issue,” he added.
The biggest concern among the 36% of respondents who said they are unhappy with their current wealth manager was quality of service at 42%, ahead of financial performance at 34%. The overall proportion of clients which were unhappy was up 9% from 27% in 2013.
Such findings need to be treated with some scepticism however, according to one senior wealth manager. “It’s important to note that you can never truly disconnect a client’s views of service, fees and financial performance,” he said. He explained that great financial performance can mean bad service is forgiven and poor performance could mean even high quality service is seen an unsatisfactory.
The wealth manager acknowledged however that the industry as a whole does need to get better at finding out what clients really want rather than giving them what they think they want, and in his view this survey is a reflection of that.
Another notable finding from the survey is that there appears to have been a drop-off in the number of clients wanting discretionary wealth management services relative to those requiring only advisory or execution services.
In 2013 73% of respondents to the same survey said they want discretionary management with the remainder wanting advisory or execution only, but this time around the number was just 58%.
