Financial advisors who want to keep their high-net-worth clients happy and in the fold would be well advised to keep their mobile phones close at hand, according to a new survey conducted by Chicago-based affluent investor consultant Spectrem Group.
Forty percent of the nearly 1,000 investors with a net worth of between $1 million and $5 million, excluding their primary residence, said they expect a call back from their advisor within two hours of placing their initial call.
Another 14% of the super rich want and expect to have their call returned within the hour, according to Spectrem's "Millionaire Investor 2010" report. Of the sample group, 72% said they expect to hear back from their advisor within 12 hours -- or else.
While independent financial advisors, broker-dealers and private banks continue to slug it out for a piece of this highly competitive and profitable slice of the investor pie, it turns out that prompt and thorough service matters at least as much or more as the various products and portfolio management advice advisors typically use to differentiate themselves.
"Advisors who don't respond promptly to their millionaire clients' calls are playing with fire," Spectrum Group President George Walper, Jr. said in the report. "Nearly three-quarters of millionaire clients expect to hear back within 12 hours of placing a call to their financial advisor, making it a big mistake to wait until the following day."
Seventy-two percent of these high-net-worth investors said failing to return calls in a timely manner is the No. 1 reason they've switched advisors in the past while only 57% identified "not providing good ideas and advice" as the primary reason for their exodus.
A similar attitude was conveyed by respondents regarding email with 56% of respondents saying they expected a follow-up email within 12 hours of sending their missive and another 24% looking for something in their inboxes within two hours.
Reasonable or not, financial advisors would be well advised to take this to heart considering more and more high-net-worth investors are ramping up their investments following a three-year stretch of high volatility and, for most, steep losses.
Last month, Spectrem's Millionaire Investor Confidence Index shot up 15 points to 17, the second-largest, one-month increase in index history.
While millionaires might be more optimistic than they've been in several years and holding their advisors to fairly high standards, they're still holding back a bit when it comes to philanthropy.
Millionaires gave an average of $5,080 in 2010 down from $6,392 in 2009, according to Spectrem, although 96% percent of people with between $1 million and $5 million in made at least one charitable contribution last year.
More than 75% of millionaires gave $1,000 to $9,999 in 2010. Sixteen percent gave $10,000 to $24,999 and 2% gave $25,000 or more.