Tips For Providing Hyper-Personalized Wealth Management Services
The coronavirus pandemic has devastated economies the world over and plunged countries into financial crisis. In the United States, think tank Brookings Institution revealed that while small business revenue fell by 20 percent since January, the U.S. personal savings rate peaked at its highest recorded level in April 2020.
For High-Earners-Not-Rich-Yet (HENRYs) and High-Net-Worth-Investors (HNWIs), the state of affairs has curbed their risk appetite and intensified the need for hyper-personalized wealth management services. In Capgemini’s 2020 World Wealth Report, talk centers on the current state of the entire wealth management industry and the need to offer value for money services during these unprecedented times.
As the demand for customized financial advice continues to grow day by the day, investment executives are eager to learn the best practices that will allow them to offer personalized assistance to their clientele. Here are my top five tips.
Tip #1 Provide personalized services during life transitions
In the Capgemini 2020 Wealth Report, less than 45 percent of surveyed HNWIs were happy with the type of service offered by their wealth managers. The majority expressed dissatisfaction because of the lack of hyper-personalized wealth management services. Highlighted problems included little to no custom treatment during tumultuous life transitions such as retirement, marriage, and growing families.
Tip #2 Reach out to children inheriting vast sums of wealth
There is a massive transfer of wealth that’s taking place as the children of baby boomers begin to inherit their parents’ fortunes. You can position yourself strategically by marketing the idea of hyper-personalized wealth management to individuals set to inherit this wealth.
Tip #3 Create attractive investment opportunities for younger HNWIs
According to the Capgemini Report, for HNWIs under 40, less than half of them were content with the manner in which their inheritance was being managed. They cited the absence of customized financial advice during the critical stages of life and no offer to educate them about their investments by wealth managers as pain points.
By creating attractive investment opportunities and providing them with the resources they need to better understand their position and wealth, you’ll draw attention to yourself as a competent wealth manager happy to provide hyper-personalized wealth management services.
Tip #4 Give technology assistance to your elderly clientele
Technology is changing so quickly and wealth managers often overlook their long-standing and oftentimes elderly clients. Of the surveyed senior HNWIs, only a third of them were satisfied with the level of assistance rendered regarding help with digital tools and apps. This leaves a glaring two-thirds without the support they require.
Tip #5 Embrace and integrate artificial intelligence into service offerings
BigTechs such as Amazon and Google have begun to encroach into the broader financial landscape. It’s only a matter of time before they enter the wealth management domain. You see, they have in their favor, the ability to offer personalized services.
To stand a fighting chance, wealth managers must seriously consider embracing AI when creating bespoke risk profiles for their clients. AI will allow for personalized portfolio construction based on client risk profile data analytics. This technology can even offer tailored product recommendations and subsequent advisory services.
The time has come for wealth executives to adapt and get on board with hyper-personalized wealth management services.
Read more about how technology is changing the wealth management space in my blog: The Rise of Robo-Advisors In Wealth Management.
