How to Attract High Net Worth Clients for Wealth Management | FIG Marketing

You’re a wealth manager, and you want your business to be part of the high-net-worth individual’s (HNWI) club. The goal is understandable from a business perspective, but you’ll need to understand the minds of those in this niche if you’re going to be accepted.

An Investopedia report found that 98% of HNWIs access the Internet daily and are early adopters of emerging products. They’re tech users and tech investors. Since 2019, the key wealth driver has been tech-driven. Apple, Amazon, and Microsoft accounted for more than 53% of S&P 500 total returns posted during 2020.

So, if you want to capture the HNWI mindshare in today’s wealth management landscape, you’re going to need to invest in talent and technology that provides omnichannel advisory services.

Let’s look at the HNWI niche.

Who’s the HNWI?

There isn’t a concrete number for just how wealthy someone must be to be considered high net worth (HNW).

However, people who fall into this category generally have at least $1 million in liquid financial assets, and in 2020 the US had the most HNW people in the world—more than 6.5 million of them. And those fortunate enough to hold at least $30 million are considered ultra-high net worth individuals (UHNWI).

According to Spectrem Group, here are the traits of a UHNWI:

Why Target the HNWI or UHNWI?

It makes sense to have a book of business filled with these individuals because when it takes more work to build and preserve those assets, the investor tends to be more committed.

The HNWI expects the same level of commitment from financial advisors as they believe in paying for expert advice to help them reach their financial and non-financial goals.

By aligning goals through dedication, wealth managers and investors will reap the rewards. HNW clients generally qualify for increased and better benefits such as separately-managed investment accounts, services with reduced fees, and the ability to participate in initial public offerings (IPOs) and invest in startups that demonstrate financial potential.

What’s the Key to Attracting HNW Clients?

Build relationships that foster trust. The perceived value of a wealth manager is driven by a combination of personal relationships and investment results.

According to a World Wealth Report, HNWIs have become more involved in their investments and now make complex demands of their wealth managers to grow their wealth.

As a wealth manager working to attract HNWIs, you’ll need to provide omnichannel capabilities and work fluidly between your client’s self-directed investment activities and their need for an advice-seeking approach.

The offshoot of investors focusing on technology means wealth managers may want to embrace and leverage this in their own business. The use of data and technology set apart the average advisor from the wealth manager looking to build their client’s portfolio.

Industry-leading managers and technology must prioritize the customer experience. Establish your brand as a leader here through software platforms like Quinci™ powered by SIMON—the industry’s first end-to-end digital sales platform.

“Commitment to human-centered design, data and insights-driven culture, and sustainable investing expertise will be important building blocks for the inventive wealth management firm.”

Successful Wealth Manager Profile for HNWIs

These six components are what a HNWI may be looking for when they choose a wealth manager. By focusing your expertise in these areas, you can create and hopefully reach your HNWI niche:

Final Thoughts on Building a HNW Client Base

Here in the US, HNWI growth continues to lead the world with a 12.3% increase observed in 2020. North American HNWIs’ wealth is primarily equity-driven, making up 38% of total asset-class investments.

The 25^th Edition of the World Wealth Report by Capgemini notes, “When faced with market volatility, HNWIs seek to preserve rather than grow their wealth and therefore tend to allocate wealth to safer asset classes.”

Building a HNWI client base doesn’t happen overnight, but by creating your brand within this niche and understanding what makes a HNWI tick, you’ll be in a better position.

Don’t go it alone. You can hear from over 20 industry thought leaders, including Financial Independence Group’s Jeremy Green and Dave Henry, on the advanced strategies you may want to focus on in the HNWI market.

Join us live on Feb. 23-25 in Orlando, FL, for our 2022 Sales Symposium.

Time’s running out to get your seat—make sure to register today!

For Financial Professional Use Only

The content within this article is for educational purposes only and does not represent legal, tax or investment advice. Customers should consult a legal or tax professional regarding their own situation. This presentation is not an offer to purchase, sell, replace, or exchange any financial product. Insurance products and any related guarantees, features and/or benefits are backed by the claims paying ability of an insurance company. Insurance policy applications are vetted through an underwriting process set forth by the issuing insurance company. Some applications may not be accepted based upon adverse underwriting results.