The two most-cited reasons for hiring an adviser are discomfort around handling financial issues (32%) and specific financial needs (32%), according to research from Morningstar.
Participants in the survey also referred to coaching (17%), recommendations from friends and family (12%) and the rest selected their adviser based on quality of relationship.
Samantha Lamas, senior behavioural researcher at Morningstar said that the report highlighted three main takeaways for advisers – address emotions from the start, some needs may remain unspoken and how you say it matters.
She said: “Most people reported hiring an adviser based on an emotional reason such as discomfort around handling finances themselves, the need for behavioural coaching and the quality of the relationship with the adviser. This means that advisers should be addressing emotions from the start.
“Clients may feel reluctant to discuss their feelings about why they are seeking help with their finances, especially with someone they just met, because such topics can make people feel some degree of powerlessness. Yet our research shows that three-in-five prospective clients sitting across the desk from you will have some emotional driver that brought them in to talk with you.
The report said that while many people may not acknowledge, or may refuse to acknowledge their need for emotional support from an adviser, previous Morningstar research may provide a ‘silver lining’.
Lamas explained: “We found that how you describe the emotional benefits of working with a financial adviser can bring more people on board.” Examples included using colloquial language, providing examples and clarifying that the issues are those that everyone faces. It added that referring to “staying in control of emotions” could be a misstep.
