“Their finances are more complex so they need more attention,” Kevin Crowe, head of solutions for SEI Advisor Network, said in an interview.
Wealthier clients spend more than half their communications time digitally, using email, web portals, social networking, SMS, instant messaging and VOIP calls.
Those are the findings of a new “Futurewealthy” report from SEI, Scorpio Partnership, and Standard Chartered Private Bank. Survey respondents had average assets of $1.9 million and expectations of accumulating still more. Of the total group, four subgroups were identified: those with personal wealth under $500,000, between $500,000 and $2 million, between $2 million and $4 million, and over $4 million.
While all the respondents spend 30.5 hours a week on some form of communication, that time rises from one wealth level to the next. Those worth less than $500,000 spend 25 hours a week communicating with others while those worth more than $4 million spend 43 a hours a week: over six hours per day. What’s more, the wealthiest of the Futurewealthy spend an average of 28 hours a week (four hours a day) on digital communications, versus 19 hours a week for the entire group.
Exchanging information electronically is likely to become eve more important. “Over a third of the Futurewealthy expect to use digital communications significantly more in the next five years,” the report reveals, “and they expect their wealth managers to follow suit.”
Among all forms of communications, email has become the clear leader. All the subgroups in the study reported spending more than four hours a week using email, on average, while the $4 million group spends nearly six hours a week. In addition, about 50% of the entire group expect to use “much more” email in the next five years.
Extensive present and future use of email might not be surprising; the same can be said for face-to-face meetings and phone calls, the next two most widely used methods of communication. However, finding “secure web portals” in fourth place, with five hours of use per week by the wealthiest of the Futurewealthy, may be unexpected.
A secure web portal is one that requires “multiple factor authorization,” according to Al Chiaradonna, senior vice president of SEI’s Global Wealth Services. That is, to gain access a client might need to enter not only a password but also key in a copy of a numbers-and-letters illustration that appears on the screen and perhaps answer a secret question, such as his or her mother’s birthplace.
“These web portals have the potential to offer interaction between clients and advisors,” Chiaradonna said, “not just the presentation of data.” Nearly 40% of survey respondents said that they expect to use such portals much more in the next five years, indicating that savvy advisors may need to develop these high-tech tools for client communications.