The itch to switch: 5 reasons investors are changing wealth management providers

In the last year, almost one in three investors (30%) and a staggering 55% of billionaires switched wealth management provider or transferred funds to multiple wealth managers, according to recent global research by ThoughtLab. Their survey of wealth managers, Wealth and Asset Management 4.0: How digital, social, and regulatory shifts will transform the industry, also confirms that the trend is not over yet as 44% of investors plan to follow suit in the next two years.

The reasons behind this switching trend are multiple but 34% clearly indicate that a wealth manager’s digital presence is more important than face-to-face interaction in deciding whether to switch services. Of course, investors changed provider pursuing better overall investment performance (53%) and access to a wider range of products (42%), as would be expected, but more surprisingly, digital experience scored just as high as advice on investment matters. This clearly indicates that online access is no longer a nice-to-have in the investor experience.

Other reasons listed for switching include better personal service, access to holistic financial planning, personal contact or trusted advisor, a fee structure better suited to their needs, lower fees, a desire to directly manage their investment, a culture more aligned with their values, and access to social impact investments.

As a wealth manager’s digital presence is more important to investors than face-to-face interaction in deciding whether to switch services, advisors and wealth managers need to rapidly redress the balance and ensure their digital presence is compelling and effective. At the same time, the expectation for digital self-service needs to be carefully balanced with high-net-worth individual demands for complex specialized investment vehicles and multi-jurisdictional practice.

Our digital onboarding system can contribute to delivering a seamless, intuitive, and easily integrated solution that not only ensures a better digital experience for clients but also adds transparency and speed without sacrificing compliance, even across multiple geographies.

For complete details about the ThoughtLab Wealth and Asset Management 4.0 study on investor megatrends shaping the future of wealth management, download the full report.