There are more affluent Americans than ever before, and that should translate to more business for financial advisors and providers as a result.
The combination of the continued recovery from the Great Recession, which is now 10 years in our past, and the atmosphere of economic growth resulting from the recent presidential election has created a record number of affluent and wealthy Americans.
Spectrem’s Market Insights 2017, which has just been released, shows that there are more than 41 million households in America with a net worth (not including primary residence) over $100,000, and there are 17 million Americans with at least $1 million in net worth. The report shows the growth annually and over a period of years, demonstrating the climb of personal assets out of the canyon created in 2008 by the Great Recession.
From the standpoint of advisors, there are two types of investors to consider as a result of the growth of personal assets in America. The first is the newly affluent, which is likely to be young people coming into their own financially for the first time. These are people who may not know anything about investing, and more importantly, they do not know what they do not know. They are unaware, perhaps, of the possibilities that exist for investing funds properly, and are likewise unaware of the pitfalls they could avoid with proper guidance from a financial advisor.
Advertising your services to this group is a multi-layered task. While younger affluent people are likely to see much of their advertising on social media, there are a lot of questions being asked about the effectiveness of that approach. Apparently, people know exactly how to click away from advertising without even considering what it says.
But the people who are actively seeking advisor assistance may be tempted to find their answers in print media as well as on financial websites. These future investors are likely to be multi-media types themselves, as most successful people are, and so a wide range of advertising options should be considered.
The second type of future client that comes as a result of the growth of personal assets in America are those who are seeing their assets climb to an unmanageable or complicated level. As personal assets grow, more choices arise as investment options, and complications naturally set in. These people may be looking for first time help as a result, or may have some minor investments in place and want to take their portfolio to another level. These investors could be searching for a different type of advisor, one who specializes in an area unfamiliar to them or to the advisor they first turned to.
The stock market continues to trend upward. The new administration promises deregulation of the banking industry, a change in tax laws and infrastructure spending in the many billions of dollars. All of that is occurring as the number of investors continues to grow as well.
What it means for the financial advisor and provider community is the opportunity for its own growth. Advisors and providers need to be aware of the changes that are going on around them, but also cognizant of the changes going on among the American populace. There are more people making more money, and that creates a greater audience for the services advisors provide.
The Market Insights report comes in the spring, which is generally considered to be a time of renewal. The sheer number of investors available to work with should generate a renewed sense of optimism and activity within your firm, because there is work are more investors to work with and more work to be done.