FDS poses disengaged client risk

September 17, 2013 AEST

Advisers who fail to connect with disengaged clients stand to lose up to 30 per cent of their client base due to fee disclosure statements (FDS), according to a consultant to financial planners.

AstuteWheel, a consultant to financial advisers, is urging advisers to demonstrate their value to these clients in order to keep the value of their current client books.

“Disengaged clients probably represent between 10 and 30% of an adviser’s client base,” said AstuteWheel director Hans Egger, who is also a qualified financial planner licensed by CBA-aligned Financial Wisdom.

“Many advisers believe that when these clients realise what they are being charged, they will fail to see value and advisers will run the real risk of losing them as clients.”

“And as most advice businesses only make 10-30% net profit, they simply can’t afford to lose them.”

Mr Egger said many advisers have been distracted by navigating around the Future of Financial Advice (FOFA) changes that they haven’t yet addressed this disengaged client base.

However, he said advisers who are “proactive” in re-engaging their clients and offering goals based advice will better retain their profitability.

“In this environment, we have to be proactive in order to remain profitable,” Mr Egger said.

“We have to demonstrate the value of our services well before sending the FDS. Leave it too long and it will simply be too late.”

Mr Egger said Astute Wealth’s client engagement platform, AstuteWheel can help explain to disengage clients, the value that an adviser provides.

“It may be that they are part of a book of clients you bought but never met,” Mr Egger said.

“They might have moved interstate or overseas and found it difficult to visit your office, or they might simply not understand all you can do for them.”
“The AstuteWheel helps overcome these challenges because clients can interact with it in their own time and place.”


AstuteWheel Client Engagement Platform <i class="fas fa-phone mid-blue"></i> 02 94 533 588
Book Demo