At a glance
- An InvestmentNews column published September 25 argues the profession keeps filing them under soft skills, and the research it cites suggests they belong in the retention budget instead.
- The American College of Financial Services asked 1,157 consumers to rank what they value most in an advisor, according to the column.
- The same column prices the failure mode, too: research from MIT AgeLab and AIG found that a lack of personal connection would lead 25 percent of clients to leave their advisor — a quarter of the book arriving as attrition that no performance report explains and no fee concession repairs.
Three of the four traits consumers say they value most in a financial advisor have nothing to do with technical knowledge. An InvestmentNews column published September 25 argues the profession keeps filing them under soft skills, and the research it cites suggests they belong in the retention budget instead.
The American College of Financial Services asked 1,157 consumers to rank what they value most in an advisor, according to the column. Knowledge and credentials came first — the answer the industry expects — while trustworthiness ranked second, the ability to listen and understand goals third, and clear communication of financial concepts fourth. The credential buys an audience; everything below it on that list decides whether the relationship survives a downturn.
The same column prices the failure mode, too: research from MIT AgeLab and AIG found that a lack of personal connection would lead 25 percent of clients to leave their advisor — a quarter of the book arriving as attrition that no performance report explains and no fee concession repairs.
Why the gap persists is the more useful question for anyone running a firm. It cites Harvard and Wharton research finding that the professionals who inspire the most trust combine competence with warmth, and it observes that advisor training covers competence almost exclusively: warmth, the quality that determines whether a client believes the advisor is acting in their interest, is rarely taught. That is one columnist's read of the profession rather than a survey of any firm's curriculum, but it matches the training calendars most RIAs actually run — planning software, product updates, compliance, and nothing left on the clock.
The imbalance has a budget consequence. Credentials generate artifacts a firm can put in a recruiting deck and a compliance file, while warmth generates retention and referrals that arrive unlabeled and get attributed to markets, service, or the client's own inertia — so training dollars follow what can be measured, the measurable half of trust keeps getting funded, and the half that shows up as attrition stays unaddressed. The cheapest retention spend available to an RIA is teaching advisors to ask better questions and then stop talking, and it is the line item almost nobody owns.
A test worth running before committing budget: put one question on the next client survey — what does your advisor do for you? — and count how many answers describe the plan rather than the person. If the mix runs heavy on the plan, the firm has a communication problem it has been calling a soft skill, and the clients who would leave over it are already on the book.
Reported by the RIA desk from InvestmentNews. Published . Corrections