Here’s What’s Keeping the Affluent Up At Night – Episode 30
As an advisor, you know full well that there’s never a shortage of challenges and concerns on your clients’ minds. But how up-to-speed are you on the specific issues that are currently top of mind for the affluent?
Let’s find out!
KEY TAKEAWAYS
- Investors are concerned about politics, taxes, personal finances, their health and technology risks (among other things).
- Meet clients where they are and be ready to listen to the challenges they say they face.
- Offer expertise in key areas of importance to the affluent.
FACE THE FACTS
CEG Insights recently interviewed some 1,200 investors—more than 1,100 of whom have at least $1 million dollars of net worth—about what’s got them worried. Here’s some of what we found:
- Political concerns. An overwhelming 91.7% of investors are now expressing anxiety about the current political climate, while 76% are troubled by the persistent gridlock in government. Additionally, a substantial 73.5% are alarmed by the growing national debt.
These concerns underscore a deepening sense of uncertainty among investors about how political dynamics could shape the economic environment and impact their investment outcomes.
- Financial concerns. While inflation is still a significant concern for many, anxiety levels have seen a slight decrease since our previous survey of the affluent—currently at 79.9%, down from 87.4% last year. However, other financial fears persist, with 72.5% of investors fretting over potential tax increases—highlighting their apprehension about fiscal policy impacts on their portfolios.
Concerns about stock market performance remain prevalent among 59.2% of investors, down sharply from 73.7% a year ago. Interest rate worries are also declining; while 51.8% of investors express concern, this number has dropped from last year’s 60.4%. These trends illustrate a nuanced picture of investor anxieties as they navigate an evolving economic environment.
- Social concerns. Cybersecurity fears have surged, with almost three-quarters of investors (72.2%) now apprehensive about potential cyber-attacks—a significant jump from 61.5% last year. Additionally, over half of investors (51.8%) continue to express concern over climate change, highlighting the broad spectrum of social issues on investors’ radars.
- Personal finance concerns. Many affluent investors are in a sort of financial tug-of -war. More than half of the affluent (55%) seek to grow their wealth and secure robust investment returns. But nearly the same percentage (52.4% ) say they’re concerned about preserving the wealth they have painstakingly accumulated.
- Health concerns. Health and longevity issues are becoming part of more investors’ financial planning. For nearly half of the affluent surveyed (45.7%), a spouse’s health emerges as a prominent worry. Close behind, 42.2% of investors are equally concerned about their own health.
The prospect of aging brings additional anxieties; 44.5% of investors dread the thought of spending their final years in a care facility. A considerable 37% are troubled by the fear of not having someone to look after them in their old age. The burden of care extends across generations, with 40.4% of investors anxious about the responsibility of caring for their aging parents—a concern that spikes to 57.4% among Millennials.
INSIGHTS INTO ACTION
It’s likely that some of these client concerns look familiar to you while others may be surprising. Given what the affluent are thinking about these days, we suggest you consider the following action steps:
- Politics. Be prepared to listen to clients’ anxieties about the political environment today. Then help them understand what the impact of various politicians’ policies could be on the financial markets.
- Financial. Note above how big a concern taxes are for the affluent. That gives you a great opportunity to discuss tax planning with clients and review potential moves that could help them mitigate their taxes. Get out in front of this issue to show clients that you’ve thinking about ways to address a key challenge.
- Social. On occasion, let clients know about the cybersecurity you’ve got in place to safeguard their data. Also consider including cybersecurity expertise to your network of professionals as a value-added service to clients.
- Personal finance. Discuss risk and return dynamics with clients—particularly those who may be hoping you can help them grow their wealth without ever incurring losses along the way! Conversations around the long-term performance of asset classes and the key tenets of behavioral finance can help clients gain important clarity.
- Health. Health concerns are having a big impact on clients’ psyche and wealth. Consider conducting workshops and info sessions on health- and healthcare-related topics (long-term care insurance, taking care of aging parents, etc.). Offering guidance in this area that causes stress for so many people can really help show you to be a holistic advisor.
SCHEDULE YOUR FREE PLAY TO WIN CONSULTATION NOW