Fiduciary Ad Campaigns May Be Hitting Home

Call it the “we do better when you do better” effect. 

Fiduciary PR campaigns and catchy slogans (see above) may be registering with investors, turning them on to financial planning and overturning a decades-long mistrust of advisors. Confidence in firms has skyrocketed in recent years; some 60% of clients now say their advisors have their best interests in mind. That’s spilling over into the retail channel, where a record 6 in 10 do-it-yourself investors are now interested in paying for professional advice, according to new research from Cerulli.

“There was a big [fiduciary] push and it seems to have been successful,” said John McKenna, a Cerulli analyst and author of the report. “It’s the idea that if I hire this person, he’s looking out for my best interest — not looking out for his bottom line.”

Max My Interest

Marketing campaigns from mega-indie firms like Fisher Investments as well as discount brokerages like Charles Schwab have flooded TV and radio in recent years. Many are touting fiduciary financial advice. Now, both men and women largely prefer full-service firms as their main provider, according to the research. It’s a trend that’s likely to continue.

“Investors are increasingly interested in paid financial advice,” said Lauren Genuardi, a managing partner at Expressive Wealth. “Investors recognize they either don’t have the interest or the time.” 

They’re also more aware of the complex decisions they face. Once planning gets more complicated — including tax advice and help with IRA rollovers — investors often need an extra hand. That may increase as wealth shifts to the next generation, whose members will suddenly find themselves with more money in their bank accounts and little time or know-how to manage it. “Hiring an advisor is no different than hiring an attorney to review a business agreement or hiring an accountant to make sure your taxes are properly filed,” Genuardi told The Daily Upside.

What Are My Options? Sure, the industry is becoming more reputable, McKenna said, but there are still challenges to overcome. Financial instruments have become more complex, and services that were once the province of ultra-high-net-worth households are opening up to retail investors.

Options trading, direct indexing, and tax loss harvesting are now only a click away on direct-to-consumer apps, but not all investments are straightforward — especially some of the riskier ones. “Strategies are moving downmarket,” McKenna said. “People are asking: ‘Is this appropriate for me?’”