The majority of advisers expect their business to grow by more than 10% and expect new relationships to be the main source of growth, says the Brinker Barometer, a gauge of financial adviser confidence with the economy, retirement savings, investing, and market performance by Brinker Capital. The overwhelming majority of advisers (86%) attribute new business to referrals.
Obstacles to Retirement
The largest chunk of advisers (20%) said extravagant lifestyle is the largest obstacle to their clients’ retirement savings, and procrastination received the second largest number of responses (18%). Although most advisers said almost all of their clients will not have to work past retirement, one-quarter of advisers said almost 35% of their clients will, the results show.
The majority of advisers surveyed (69%) said their clients want access to consolidated account information and third-party products through their adviser. A smaller number said their clients want to use a single financial provider (15%) or want to maintain separate reporting and relationships with several other providers (13%), the survey says.
Optimism for Economy
Financial advisers continue to be optimistic about the U.S. market and economy, although 79% said they agree with Warren Buffet that the U.S. is “essentially in a recession,” the report says.
“The first quarter’s Barometer results show some interesting differences between the still-optimistic views of financial advisers contrasted against market volatility, escalating oil prices and inflationary fears,’ said John Coyne, president of Brinker Capital. “In fact, 64% of our financial adviser respondents say they are either “highly confident’ or “somewhat confident’ about the U.S. economy, and 66% feel the same way about the financial markets. What’s remarkable is that these sentiments haven’t changed in any discernible way since we began issuing the Barometer a year ago.’
When asked what the most immediate priority of the new president should be, 48% of respondents said “bolstering a weak economy,’ followed by 16% who noted “winning back America’s respect in the eyes of the world,’ and 13% who said “shoring up a falling dollar.’ Other notable responses included “capping gas prices at the pump,’ “Iraq troop reduction’ and “healthcare reform.’
Asked to name the areas in which they would most welcome federal intervention, 65% of advisors responded with “supporting a weakened dollar,’ 59% with “stabilizing the financial markets,’ and 31% noting “cutting interest rates before year’s end.’ Other responses included “discourage job outsourcing to foreign nations,’ “regulating gas prices’ and “providing financial relief to embattled homeowners.’
While John McCain is the overall candidate of choice among financial advisers, Barack Obama is the favored Democratic choice. While 22% of advisers reported in Q4 of ’07 that a Democrat in the White House was their “single greatest economic worry,’ 54% would favor Obama over Hillary Clinton, the survey says.
The Brinker Barometer results are based on responses from 266 advisors affiliated with insurance companies, independent broker-dealers and in sole practice. Of the advisers surveyed, 69% were brokers affiliated with insurance company; 24% were independent advisers; and 7% were independent broker/dealers.