Asian-American clients are looking to advisors for guidance and not getting it.
While advisors look to expand their wealthy client base, there’s one group that is still dramatically underserved: Asian-Americans. Only 18% of Asian-American clients work with an advisor, compared with 26% of the general population, according to Prudential’s new Asian-American Financial Experience study. Yet this group has higher average income than the overall populace, and 43% of those surveyed told Prudential they were willing to hire professional financial help.
The number of Asian-Americans is expected to grow by 20 million to 40 million in the next two decades, says Srinivas Reddy, Prudential Retirement's head of Full Service Investments.
Please click above to learn more about the investing characteristics of this client group.
Note: All data is from Prudential.
Greater investing capabilities
This population has more wealth than the general population, which has average household financial assets of $385,500. About 17% of Asian-Americans have at least $500,000 of equity in their homes compared with 8% of the general population.
How much do they earn?
The median household income of this population segment is higher than the general population's $62,000.
Few clients in this group utilize the services of financial professionals, although 43% would consider it.
An earlier post-work life.
Asian-Americans plan to retire 15½ months earlier than the general population, which anticipates retiring at 65.9 years old.
The lack in financial knowledge
Asian-Americans are relatively confident with their financial health, but they are less likely to view themselves as financially knowledgeable, Prudential says. Just 31% of respondents consider themselves as "very well prepared " to make financial decisions, compared with 33% of the general population.
Hungry for information
44% of Asian-American clients say family members are their preferred source of financial information compared with 37% of the general population.
The issue of advisor-client trust
One-in-five Asian-Americans say they never found an advisor they trust. Prudential also highlights that these skeptical clients are more likely to think fees are too high.
Asian-American clients who work with advisors are more likely to be born in the U.S., the study says.