Filed Under:Life Insurance, Life Planning Strategies

Consumers prefer certified advisors

More than 8 in 10 consumers believe that “certifications are important when choosing a financial advisor.”
More than 8 in 10 consumers believe that “certifications are important when choosing a financial advisor.”

It’s long been known that advisors who boast one or more professional designations earn more than their non-certified counterparts. Evidently, one reason for this is that consumers favor insurance and financial service professionals for the perceived added value that comes with such designations.

According to a new survey from ORC International, more than 8 in 10 consumers (84 percent) believe that “certifications are important when choosing a financial advisor.” This preference is most pronounced among older boomers (ages 55-64) who are preparing for retirement: An overwhelming majority of them (91 percent) take educational designations into account.

Closely tied to the consumers’ preference for educational attainment is another desired attribute: Knowledge of financial planning. Roughly half of consumers (48 percent) look for such expertise when choosing an advisor. Attributes less frequently cited by consumers in the ORC survey are ethics (20 percent of respondents), years in the business (17 percent), an ability to offer a variety of financial products (11 percent) and “something else” (four percent).

When looking for financial advice, the survey adds, a large majority (70 percent) of consumers prefer an advisor who can offer counsel on their whole financial situation, rather than expertise limited to a specialization (30 percent). And more than 9 in 10 consumers (91 percent) expect the advice they receive to take into account their total financial picture.

The most important type of certification, the survey adds, demonstrates knowledge of multiple financial planning areas, preferred by 68 percent of consumers, as compared to the one in five (21 percent) who want knowledge in a specialized area.

The survey observes also that nearly 9 in 10 consumers (87 percent) would feel more confident working with an advisor who has a financial planning designation. This is true across age groups, but again most pronounced among boomers ages 55-64:

 

18-34

35-44

45-54

55-64

65+

Yes

88%

86%

86%

89%

83%

No

12%

14%

14%

11%

17%

Chart shows percentages of respondents by age group who would feel more confident working with an advisor who has a financial planning designation.

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