{"id":9377,"date":"2024-04-18T08:00:52","date_gmt":"2024-04-18T08:00:52","guid":{"rendered":"https:\/\/emoneyadvisor.com\/blog\/?post_type=thought_leadership&p=9377"},"modified":"2024-04-16T14:10:27","modified_gmt":"2024-04-16T14:10:27","slug":"empowering-financial-wellness-how-client-portals-reduce-financial-anxiety-and-transform-client-relationships","status":"publish","type":"thought_leadership","link":"https:\/\/emoneyadvisor.com\/blog\/empowering-financial-wellness-how-client-portals-reduce-financial-anxiety-and-transform-client-relationships\/","title":{"rendered":"Empowering Financial Wellness: How Client Portals Reduce Financial Anxiety and Transform Client Relationships"},"content":{"rendered":"

Feelings of financial insecurity have surged to an all-time high among Americans, with one-third (33 percent) reporting that they do not feel financially secure, according to Northwestern Mutual’s 2024 Planning & Progress survey1<\/sup>. This has led to heightened feelings of financial anxiety, leaving many individuals worried about their financial future.<\/p>\n

Financial professionals are well-positioned to address this issue. Our 2023 Beyond the Plan research shows that financial advisors who address a client\u2019s financial anxiety through incorporating actions based on financial psychology (finpsych) see greater client satisfaction. Furthermore, tech-forward advisors\u2014those who embrace technology and believe it\u2019s an important part of the client experience\u2014see remarkably better outcomes than tech-averse advisors in multiple categories, including lessened client financial anxiety and increased client satisfaction, trust, and loyalty.2<\/sup><\/p>\n

Why Are Americans Stressed?<\/strong><\/h2>\n

One of the most prevalent and enduring types of stress is financial stress. When it comes to managing our money, we often encounter stressors on a regular basis\u2014such as unexpected car repairs, childcare expenses, and more. Although worrying about not having enough money to cover unexpected expenses can cause financial uneasiness, financial anxiety runs deeper. It can involve obsessing over where every dollar is spent or imagining situations where you lose all of your money.<\/p>\n

Despite the growth in wealth and income for U.S. households in 2022 and 2023, the Federal Reserve’s Report on Economic Well-being of U.S. Households revealed a concerning trend: the percentage of adults who reported being at least financially stable in 2022 decreased by 5 percent compared to 2021, standing at 73 percent. Additionally, in February 2023, a Gallup survey found that 50 percent of U.S. adults felt they were financially worse off than the previous year, while only 35 percent believed they were better off. Building the case for why helping people \u2018feel\u2019 financially well is just as important, if not more so, than showing them they are financially well.<\/p>\n

The Link Between Financial Anxiety and Client Satisfaction<\/strong><\/h2>\n

Our research demonstrates that client satisfaction increases significantly\u2014by 61 points\u2014when clients feel their advisor has helped to reduce their financial anxiety.<\/p>\n

\"Graph<\/p>\n

While advisors are certainly not therapists, adopting best practices in financial psychology can help reduce clients’ financial stress, boosting their confidence, financial success, and satisfaction with your services.<\/p>\n

Our research identifies the top five most effective finpsych actions in reducing financial anxiety:<\/p>\n

    \n
  1. Assist clients in identifying meaningful personal and financial goals<\/li>\n
  2. Prioritize understanding clients’ values before offering financial advice<\/li>\n
  3. Always consider what clients value most in life<\/li>\n
  4. Make an effort to learn about clients’ money behaviors and attitudes<\/li>\n
  5. Communicate recommendations in terms clients can understand<\/li>\n<\/ol>\n

    In essence, advisors who practice active listening, dig into client values, address financial concerns, and communicate effectively can mitigate financial anxiety and significantly improve client satisfaction.<\/p>\n

    To learn more about implementing these five finpsych actions, take a deeper dive into our eBook The New Advisor Value Proposition: How Combining Technology and Financial Psychology Transforms Client Outcomes.<\/em><\/a><\/p>\n

    Why Client Portals Are an Advisor\u2019s Best Tool Against Financial Anxiety<\/strong><\/h2>\n

    When financial anxiety decreases, trust, loyalty, and overall client satisfaction increase. Technology, specifically a client portal, is a helpful tool to accomplish this.<\/p>\n

    This is because the use of a client portal helps advisors meet key client priorities. Clients report that a portal increases their collaboration with their advisor, deepens their knowledge of personal finance, and ultimately strengthens their relationship with their advisor through better communication.<\/p>\n

    Portals meet these client priorities by:<\/p>\n