Is Video Chatting Financial Advisors Here to Stay?

11/1/2021

Since the start of the Covid pandemic, many households and individuals have been thrust, however unwillingly, into learning how to communicate through technology.  Families have been separated, leaving grandparents with no other method of regular communicating with grandchildren besides phone and video chat. Video chat was also utilized by many investors as a method of communicating with their financial providers.

In 2021, the quickest adapters to video chat unsurprisingly have been Millennials, according to research from Spectrem Group. Forty-one percent of Millennials communicate with their financial advisor through video chat. It is worth noting however that over a third of WWII investors and nearly half of Baby Boomers and Gen X investors would be willing to communicate with their advisor through video chat.

When investors were asked how they would like to spend their time with their advisor over the next year, they indicated that they would want to spend only 16 percent via video chats. That percentage jumps up to nearly a third of Millennials time with their advisor they would prefer to be through video chat, and a quarter of Gen X time with their advisor they would prefer to conduct through video chat. Face-to-face communication is losing out to telephone communication among Gen X and WWII investors, who would prefer to spend the majority of the time with their advisor on the telephone.

There are some topics that investors would prefer to discuss in-person only, however. Investment management and financial planning are the two topics that the greatest percentage of investors would prefer to discuss via in-person meetings only. Over a quarter of wealthy investors would also prefer that estate planning conversations take place only in-person. Every other topic investors seem to be mostly okay with discussing over the phone or a video chat.

Just because most wealthy investors are okay with telephone calls and video chat does not mean they want their advisor to not be within driving distance of their primary residence. Three-quarters of Millennial investors indicate that it is important that their financial advisor be within driving distance of their primary residence. Only 40 percent of Gen X investors share that sentiment, while around half of Baby Boomers and Gen X investors feel that it is important that their financial advisor be within driving distance of their home.

So, while investors may still use Zoom or another video-chat platform to see friends and family, it does not appear that video-chats will take the place of quality telephone conversations and in-person visits with a financial advisor. Even if investors have moved, which has been more likely among younger investors, it is still important to them that their financial advisor be within driving distance of their primary house. That makes location and the need for in-person visits to continue to be an important component in any client/advisor relationship, as well as part of the advisor selection process. Video may have killed the radio star, but it certainly isn’t killing the telephone one.