More advisors are optimistic about the economy when compared with previous years, but are concerned with rising interest rates and tax burdens, according to a new survey report published by Curian Capital.
The "Curian Advisor Survey: 2013 Outlook for Advisor Priorities" also indicates that fewer than half of respondents have incorporated social media into their business strategies.
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A survey of more than 2,000 advisors, also found that only 6% of advisors consider social media as one of their top three sources of new leads.
Moving to product selection, the survey found 87% of advisors think the tax-efficiency or after-tax performance of their clients’ portfolio is important.
Alternative investments are another focus for the firm. While more than 30% of advisors said they currently had 10% or more of their assets under management allocated to alternative asset classes, more than 31% of respondents said they planned to increase their use of alternative investments by 5% to 10% this year.
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By GlobalDataWhile advisors were divided about their outlook on the financial crisis in the 2012 survey, respondents are now overwhelmingly positive. Nearly 54% of advisors reported they believe the economy will get better over the next year. Only one-fifth of respondents reported they believe the economic crisis will be long term.
Unemployment topped the list of the economic issues that advisors believe are the biggest threats to their clients’ wealth management plans at 23%, followed by government spending at 20%; 30% of respondents reported their clients also feel unemployment is the highest perceived threat to their retirement accounts, followed by market volatility at 14%.
Product Selection and Investment Strategies
According to the report, nearly 95% of advisors surveyed were moderately or very concerned about rising interest rates and the effect this may have on the value of their clients’ fixed-income investments.
Tax efficiency has also arisen as a major concern of advisors, with more than 87% of respondents reporting that tax efficiency and after-tax performance are important aspects of the solutions they propose to clients.
Despite this concern, 63% of advisors said they have access to, and actively use, tools and strategies to reduce the impact of taxes on clients’ investment portfolios. However, more than 28% of respondents said while they have access to the tools and strategies to help reduce the impact of taxes on their clients’ portfolios, they do not actively use them.
Practice Management
The Curian survey found the 56% of advisors do not use social media within their practices. In addition, only 6% of respondents ranked social media as one of their top three sources of new leads.
Apple iPads are the preferred mobile tablet device of more than 50% of advisors, while one-third of advisors don’t use a tablet device in their practices. When asked what type of mobile device advisors would like to see from an asset management firm, the response was split, with 49% saying they prefer apps that mimic a firm’s primary website and 46% saying they prefer calculators or tools for business purposes.
