New research shows that millennials are more likely to feel they get value for money from their relationship with their wealth manager.
EY’s Global Wealth Research Report is a detailed survey of 2,500 wealth management clients in 21 countries, 73 percent of whom thought they were getting value for money.
Seventy-eight percent of millennials either agreed or strongly agreed they were getting value, compared with 70 percent of generation X and 73 percent of baby boomers.
Clients in the Americas tended to be much more satisfied, with Middle Eastern clients the least likely to agree they were getting value for money (62 percent).
However, 42 percent of clients were concerned about hidden costs when working with their wealth manager, driven by a more anxious younger audience, which suggests there is scope to improve transparency, EY said.
The study also pointed out a growing expectation that the “basic” elements of wealth offerings would be provided at zero cost. By 2024, an increasing number of investors will expect free transaction services — such as equity trading — and over 30 percent will expect free portfolio reports, EY said.
“The good news for providers is that while clients are expecting more for free, they are still willing to pay extra for tailored elements of the wealth proposition,” the report’s authors noted.
“For example, 49 percent of investors would pay more for increasingly personalised and specialised products and services.”
The research finds a majority (78 percent) of respondents have personal sustainability goals, yet 41 percent feel their wealth manager falls short in understanding their values.
Awareness of specific environmental, social and governance (ESG) themes has increased over the past year.
In light of this, a major reallocation of investments could be in the cards, EY predicted. Seventy-six percent said it is important to consider ESG parameters in their portfolios and impact investing is expected to grow 15 percent by 2024, reaching an average adoption level of 35 percent.
