This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Length Of Relationships, Performance And Perceived Stability Of Firm Key Drivers Of Financial Advisor Client Referrals

Most financial advisors significantly underestimate the amount of time it takes for clients to be comfortable providing referrals, a key source of new business for financial professionals, according to a new Prudential white paper.

The report, “Referrals: A Matter of Trust,” reveals that clients take on average 4.8 years to be comfortable recommending their financial advisor, more than twice as long as the 2.1 years on average advisors thought. The paper underscores the relevance of client referrals, with 56 percent of clients having provided referrals and an additional 36 percent saying they would consider doing this.

“While the length of the relationship with an advisor is a key consideration for clients making referrals, there are many other factors that are likely to influence clients’ decisions,” said Rodney Allain, senior vice president and National Sales Director for Prudential Annuities. “By surveying both clients and advisors, this white paper provides valuable perspective on the drivers of client referrals.”

Clients who were more likely to refer their advisors rated their advisor “excellent” or “very good” at setting realistic expectations about investment returns (86 percent), delivering on what was promised (86 percent), and achieving strong investment performance (79 percent). Notably, 80 percent of these clients rated their advisor highly on disclosing their fee levels.

The study was based on data collected in 2011 from 800 clients and nearly 400 advisors.

The paper notes that clients value a broad set of services beyond simply generating investment returns. For example, 64 percent of clients who were likely to refer their advisor had been provided with a written financial plan, compared to only 46 percent of clients who were less likely to provide referrals. Similarly, receiving advice about generating steady retirement income and preserving and protecting savings tracked with a higher likelihood of providing referrals.

1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $94.19 -1.04%
FB $118.06 0.54%
GOOG $695.70 0.48%
TSLA $222.56 -4.20%
YHOO $36.00 -0.03%


Chart of I:DJI
DOW 17,651.26 -99.65 -0.56%
S&P 500 2,051.12 -12.25 -0.59%
NASDAQ 4,725.6390 -37.5850 -0.79%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs