Exploring Wealth Potential Across the Spectrum of Investors:

Insights on Advice
Exploring Wealth Potential
Across the Spectrum of Investors:
Findings from the 2014 Fidelity® Millionaire
Outlook Study uncover valuable insights from
the emerging affluent to the deca-millionaire
The Fidelity® Millionaire Outlook Study,1 n ow in its seventh year,
typically analyzes the investing attitudes and behaviors of
millionaire households. Since Fidelity research shows that 55%
of participating advisors2 are planning to target emerging and
mass affluent investors in the next five years, this year’s study3
surveyed investors across a wider spectrum to assess their
ability to accumulate wealth.
Inside:
The findings shed light on the true wealth potential of emerging
affluent investors,4 s howing they are well positioned to
potentially attain millionaire status. Most importantly, these
investors have very similar attitudes and behaviors to today’s
millionaires when it comes to handling their wealth.
This paper examines four distinct investor segments to
uncover lessons for investors and advisors that may help
drive wealth creation.
The study involved a total of 1,064 35-minute online interviews, completed from July 14 to 28, 2014. Respondents were
screened by a minimum in investable assets (excluding retirement assets and primary residence), age, and income levels.
The sample was provided by Bellomy Research’s network of online panel partners, a third-party firm not affiliated with
Fidelity Investments.
2
Based on advisors who participated in the 2014 Fidelity Advisor Insights Study, part of Fidelity’s Insights on Advice
program. This was an online, blind survey (Fidelity not identified) fielded during the period of September 18 through
October 6, 2014. Participants included 933 advisors from across multiple firm types who work primarily with
individual investors and manage a minimum of $10 million in individual or household investable assets. Bellomy
Research, an independent third-party research firm not affiliated with Fidelity Investments, conducted the study.
3
The term study used throughout this paper refers to the 2014 Fidelity® Millionaire Outlook Study.
4
Emerging affluent are ages 21–49 with investable assets of $50,000 to less than $250,000, and household income of
$100K or more. Investable assets include: cash, checking accounts, savings accounts, certificates of deposit, money
market funds, mutual funds, exchange-traded funds, stocks, bonds, futures, options, 529 plans, IRAs, SIMPLE, Keogh
retirement funds, annuities, hedge funds, separately managed accounts, lifecycle funds, and collectibles (e.g., precious
metals, art, wine) purchased for investment purposes; excludes any real estate or investments in 401(k), 403(b),
pensions, or other employer-sponsored retirement plans.
1
1. A Changing Investor Landscape
2. Asset Accumulation Potential
3. Wealth Mindset
4. Steps to Help Increase Wealth
5. Summary
1 | A Changing
Investor Landscape
Many advisory firms tend to focus on
an older and wealthier segment of the
market. According to the Fidelity 2014
Executive Forum Poll,5 seven in 10
participating firms said that investors
49 years of age or older, or those with
$1 million or more in investable assets,
dominate their current client acquisition
strategy. But times are changing, and
an increasing number of advisors
recognize the need to think beyond
their typical client base as they look to
the investor of the future.
Approximately 90% of the
American population has
$500,000 or less in investable
assets.
— Cerulli Associates6
This new focus is not a surprise given
the thousands of baby boomers who
are retiring every day,7 and the reality
that a younger generation will take
their place. With $1 trillion projected
to transfer to Gen X/Y8 individuals
every year for the next 40 years,9 this
shift also seems like a natural — and
Advisors Continue to Target an Older, Wealthier Investor
49+
YEARS OLD
$1 million5
OR
IN INVESTABLE ASSETS
potentially necessary — adjustment. Of
course, a person’s ability to accumulate
wealth over time depends on a number
of factors, including their financial
outlook and attitudes, age, income
level, investment strategy, and savings
rate. As we look forward, which groups
of investors will be able to maximize
their wealth potential?
To help investors and advisors keep an
eye on the future, the 2014 Fidelity ®
Millionaire Outlook Study took a
different approach than in the past
and explored a wider spectrum of
investors, including the emerging
affluent, the mass affluent, millionaires,
and deca-millionaires.10 By doing so,
the study aims to help non-millionaires
understand how specific traits may
have helped millionaires and decamillionaires accumulate their wealth. It
also seeks to help advisors understand
how best to serve a new type of
investor by pointing out similarities
and differences that can exist when
compared to today’s traditional client.
Many Factors Affect Wealth Potential
FINANCIAL ATTITUDE
AGE
INCOME
INVESTMENT STRATEGY
SAVINGS
INHERITANCES
LIFESTYLE
DEBT LEVELS
The Fidelity 2014 Executive Forum Poll was conducted between May 4 and 7, 2014. Ninety-two registered investment advisor (RIA) and correspondent broker-dealer
Fidelity clients attending Executive Forum completed questionnaires at the event. The results of this poll may not be representative of all financial advisors meeting
the same criteria as those surveyed at the Fidelity 2014 Executive Forum.
6
The Cerulli Report, Advisor Metrics 2013, Cerulli Associates.
7
Baby Boomers Retire, Pew Research Center, December 29, 2010.
8
Born between 1965 and 1993.
9
Investor Brandscape Study, Cogent Research, 2013.
10
Mass affluent: ages 21–54 with investable assets, excluding workplace retirement accounts and any real estate holdings, of $250,000 to less than $1 million or age
55+ with investable assets, excluding workplace retirement accounts and any real estate holdings, of $500,000 to less than $1 million; millionaire: investable assets
of $1 million to less than $10 million, excluding workplace retirement accounts and any real estate holdings; deca-millionaires: investable assets of $10 million or
more, excluding workplace retirement accounts and any real estate holdings.
5
2
Four Affluence Levels Across the Wealth Spectrum11
Emerging Affluent
MASS Affluent
Millionaires
Deca-Millionaires
$250,000
$800,000
$2.5 million
$11.75 million
40
58
62
64
% Female
68%
48%
40%
23%
White/Caucasian
75%
91%
91%
91%
Median annual
household income
— employed
$125,000
$125,000
$200,000
$875,000
Median annual
household income
— retired
NA
$75,000
$125,000
$375,000
1%
38%
51%
55%
Median investable
and retirement assets
Average age
% Retired
Findings revealed that some
characteristics remain constant despite
one’s level of affluence, while other
traits change along the spectrum
of wealth. Findings also revealed
that the emerging affluent are well
poised to become millionaires—
perhaps even surpassing the wealth
of today’s millionaires. In addition, the
emerging affluent may soon be seeking
advice, because the majority (90%)
who don’t use an advisor feel they
aren’t knowledgeable enough about
investments to make decisions on
their own. With digital advice options
starting to compete for this younger,
tech-savvy population, it may be time
for advisors to reach out more actively
to this group.
11
Among emerging affluent
Gen X and Gen Y investors,
29% surveyed were familiar
with digital advisors, and 7%
already work with one today.
The sections that follow look at two
important factors that can help to
determine whether investors may
increase their wealth over time: asset
accumulation potential and wealth
mindset. This is followed by a look at
steps investors and advisors might
consider to put an investor’s potential
and mindset into motion to help them
increase their wealth.
2 | Asset Accumulation
Potential
Not surprising, study participants who
have already surpassed the milliondollar mark in terms of investable
assets are older than the emerging
or mass affluent, and have had more
time to build their nest eggs. These
millionaires and deca-millionaires
represent the investors that many
advisors are focused on today, but
new opportunities are coming to the
forefront.
59% versus 51%
Percentage of emerging and mass affluent
investors who are seeking advice in this
year’s study versus in last year’s study
A s defined in the survey; all statistics in the paper are from the 2014 Fidelity® Millionaire Outlook Study unless otherwise noted.
3
Emerging Affluent Investors
Tend to Have Strong
Millionaire Potential
While the emerging affluent in the
study may not be the most attractive
group today in the eyes of many
advisors, many factors point to their
ability to accumulate wealth over time:
age. On average, emerging
affluent investors surveyed are just 40
years of age, and they have time on
their side to gather assets.
Similarities in Chosen Professions Between the Emerging Affluent and Millionaires
Emerging Affluent
Millionaires
Information Technology 13%
Education 12%
Medical 9%
Information Technology 11%
Finance/Accounting 9%
Finance/Accounting 11%
• Young
• High-potential
professions. Many of
the emerging affluent surveyed have
pursued similar professions to today’s
millionaires, including IT and finance/
accounting. While they might be at
lower-level positions than millionaires,
they have a number of years in front
of them to move up the ladder.
• High
income. At $125,000, the median
annual household income for this
group substantially exceeds the
median U.S. household income.12
27
2.5X
Average number of years left before
the emerging affluent reach the
normal retirement age of 67*
Amount by which the median
annual household income of the
emerging affluent exceeds the
median U.S. household income
*Retirement age: Social Security,
http://www.ssa.gov/retirement/ageincrease.htm.
The Emerging Affluent are Poised to Move Up the Wealth Spectrum
Current
Wealth
Emerging Affluent
Mass Affluent
$250,000
$800,000
Time horizon
to age 67
(in years)
9 years
Based on median total population U.S. income of $51,939 in 2013; US Census Bureau.
4
DECA-MILLIONAIRES
$2.5 million
$11.75 million
5 years
27 years
12
MILLIONAIRES
3 years
If the emerging affluent follow a
diligent savings and investment plan,
they can potentially benefit from the
effects of compounding over the
years. Their ability to save may also be
influenced by possible inheritances,
given that one-third (33%) surveyed
indicated they are likely to benefit from
an inheritance of $25,000 or more.
The Mass Affluent May
Approach the Millionaire
Mark, But There is Potential
for Some to Plateau
With 55% of mass affluent investors
still being employed, and an average
age of 58, they could potentially
become millionaires, but this will
require a strong focus on saving and
investing.
Those who are currently retired will
need to closely guard their wealth.
With a median annual household
income of $75,000, they may need
to tap into their assets for ongoing
expenses depending on their lifestyle.
They, too, will likely need to put in
place prudent savings and investment
strategies to help them protect
and/or build their assets.
Primary Source of Household Income Changes with Wealth*
Primary source of
current household
income
Millionaires
DecAMillionaires
48%
32%
9%
7%
6%
9%
17%
Capital appreciation of
investments
6%
12%
23%
27%
Investments: dividends
and/or interest
0%
1%
5%
14%
0%
11%
11%
4%
Emerging
Affluent
Mass
Affluent
71%
Proceeds from owning a
business
Salary from employer
Pension
Percentages in bold in this table and others highlight a large difference when compared to others.
*Percent of investors indicating their primary source of current household income.
Deca-Millionaires Continue
to Accumulate Wealth, While
Millionaires May Slow Down
Deca-millionaires in the study stood
out from others with respect to asset
potential, having a very high median
annual household income even in
retirement ($375,000). While still
relatively high, the median annual
household income for working
millionaires ($200,000) is far below that
of working deca-millionaires ($875,000)
and, with 51% of these investors being
retired, they should consider being
more cautious about spending and
focused on effectively managing
their portfolios.
Among both categories of millionaires,
close to one-quarter claim that their
primary source of household income
comes from capital appreciation of
investments. Proceeds from owning
a business, dividends/interest, and
company stock benefits are also
important income generators for
deca-millionaires.
5
3 | Wealth Mindset
Asset potential is important to
maximize wealth, but investors need
to have the right mindset to make it
happen. Surprisingly, the emerging
affluent have many of the same traits
as wealthier investors — traits that
should help them build their wealth
over the many years they have in front
of them to save and invest.
Investors Show a Capacity to
Build Wealth
Across all groups in the study, about
eight out of 10 investors have earned
or increased assets on their own. This
preponderance of self-made wealth
suggests that many of these investors
have the capacity to work hard and/or
invest in a smart manner to grow their
asset base. This attitude/approach
should help them as they strive to
build their wealth going forward.
Investors Have a Strong
Focus on Wealth Creation
According to the study, approximately
three-quarters of investors in each
group focus on long-term growth of
their assets. As mentioned earlier,
the mass affluent and millionaires
will need to make their money work
hard for them, especially as they near
~33%
Percentage of emerging affluent, mass affluent, and millionaire investors concerned about
supporting their desired lifestyle in retirement
retirement and begin to end the asset
accumulation stage of their lives.
The emerging affluent are concerned
with providing for their family’s
financial security, largely due to their
relatively young age. They are also
just as concerned as the mass affluent
and millionaires with supporting the
lifestyle they want in retirement, which
should drive them to think about
strategies to build their wealth now
when they are working. Having the
largest asset base of all groups, decamillionaires are most concerned with
minimizing their tax bill (31% concerned
about this).
According to the study, the emerging
affluent show a clear desire to get
wealthier. Compared to others,
they display a willingness to invest
aggressively to help maximize returns,
as well as a willingness to set aside a
significant portion of their portfolio for
riskier investments. This is a trait shared
with deca-millionaires.
A focus on retirement assets is another
indicator that investors have the
mindset to help reach their wealth
potential. Across all groups, a large
percentage of investors who use advice
have their advisor either manage
these assets or include them in the
overall plan. For those whose advisors
do not provide this support, a large
percentage would like them to do so.
Investors Recognize the
Benefits of Financial Advice
More than half of each group see the
benefits of having professional support
to achieve investment success, and
believe that an advisor is important
to make this happen. In addition, as
advice usage increases, so too does
an individual’s level of confidence that
their investment strategies are aligned
with their long-term financial goals.
The Emerging Affluent and Deca-Millionaires
are More Alike Than One Might Think
Emerging
Affluent
Mass Affluent
Millionaires
DecA-Millionaires
48%
33%
28%
36%
41%
28%
24%
32%
Attitudes
Invest aggressively with focus on
maximizing returns
Willing to set aside a significant portion
of portfolio for risky investments
6
Views About Financial Advice
Emerging
Affluent
MASS AFFLUENT
Millionaires
DECA-Millionaires
51%
56%
56%
53%
48%
63%
70%
71%
56%
77%
88%
83%
Feel a financial advisor is important to
achieve investment success
Use a financial advisor
Feel confident that their investment
strategies are aligned with their longterm financial goals
Close to half (48%) of the emerging
affluent use an advisor, and the vast
majority trust their advisor to make
decisions that are in their best interest.
In addition, a large percentage rely on
their advisor to keep them on track.
Over half (53%) who have professional
support would also like to consolidate
more of their assets with their primary
advisor, suggesting a desire to build
a deeper relationship to focus on
their wealth.
Investors are More Confident
About the Future Financial
Outlook than Today
and mass affluent investors who
engage an advisor have a more positive
financial outlook than those who don’t.
Advisors may be providing the financial
education and help these investors
need to both bridge the knowledge
gap and improve confidence. This
is not seen at the upper ends of the
wealth spectrum, however, where more
assets are at stake and investment
knowledge is stronger.
Views on the financial outlook13
improve with wealth, perhaps, in
part, because those in the millionaire
categories feel more knowledgeable
about investing. Deca-millionaires are
the most optimistic about how things
will look over the next 12 months.
While millionaires appear to be more
optimistic than the lower wealth
segments, their views on the future
have hit a five-year low. The emerging
Outlook: Scale of +100 (most favorable) to –100 (most unfavorable)
ADVICE
USER
TOTAL
TOTAL
19
14
NONUSER
ADVICE
USER
19
15
TOTAL
9
ADVICE
USER
27
27
NONUSER
25
18
8
5
3
3
3
3
−3
−4
−5
−9
Emerging Affluent
−8
Mass Affluent
Millionaires
CURRENT CONFIDENCE INDEX
13
TOTAL
28
ADVICE
USER
21
NONUSER
8
1
NONUSER
DecA-Millionaires
FUTURE CONFIDENCE INDEX
Using a scale where +100 represents the most favorable outlook, zero is neutral, and –100 is the most negative outlook, the survey measures respondents’ confidence
levels across five key areas — the stock market, consumer spending, the economy, business spending, and the value of real estate. Combined, the five variables
make up a cumulative current and future confidence level, or “outlook.”
7
4 | Steps to Help
Increase Wealth
Assessing the similarities and
differences of the wealth segments
along the spectrum may provide
interesting insights for both investors
and advisors.
Emerging Affluent
Wealthier investors use an advisor more
than the emerging affluent
Emerging affluent investors not using
an advisor may want to consider doing
so to help design an appropriate
investment plan and keep them on
track to reach their financial goals.
Advisors may want to point out that
a relationship can potentially lead to
different diversification strategies, such
as considering alternative investments
and real estate holdings in their
portfolio if the eligible investor is
informed about, and comfortable with,
the related risks.
Since almost one-quarter (23%) of
emerging affluent investors feel that
advisors are not interested in forming
a relationship with them given their
current level of assets, according to the
study, it will be important for advisors
to demonstrate that they are welcome.
Advisors should also be aware that fees
are an issue for this group, with 60%
saying they would be more likely to
work with an advisor if their fees were
lower. It may be worthwhile to consider
offering a different fee structure for a
scaled-back set of services to get these
investors involved in a relationship
early on.
The Potential Impact of Advice
27% versus 13%
Percentage of emerging affluent investors using an advisor
and not using an advisor who have alternative investments* in
their portfolio
40% versus 24%
Percentage of emerging affluent investors using an advisor
and not using an advisor who have real estate† in their portfolio
The emerging affluent have a different
demographic profile than that of
other investors
The next generation of investors will
have a different demographic profile
from today’s typical baby boomer
client. If working with an advisor, the
emerging affluent should consider
openly discussing their views and
preferences so advisors can understand
how they can best work together. In
turn, advisors should consider the
implications of this different investor
profile for the style and frequency of
communication, and the topics that will
need to be discussed.
They have some concerns with
wealth creation
According to the study, emerging
affluent investors have concerns
with their family's financial security,
supporting their lifestyle in retirement,
reducing household debt, and saving
for a child’s education and should
consider taking steps to develop
plans to handle these areas. If working
with an advisor, they may also want
*For example, private equities, structured products, and hedge funds.
†
Including real estate investment trusts, but not including the investor’s private residence.
8
to consider having retirement assets
managed or included in a plan.
Advisors should be aware that more
than half (52%) of emerging affluent
investors share investment decisionmaking responsibilities with others,
and engaging spouses, partners, and
family members may be important
for any discussions about these
important concerns.
Emerging affluent investors who use
an advisor would also like to see them
provide more comprehensive services,
such as tuition and risk planning. Taking
steps on this front may help advisors
satisfy the needs of existing clients as
well as attract new ones.
They need to build their
investing confidence
Despite being willing to invest
aggressively, just under one-quarter
of the emerging affluent feel
knowledgeable about investing. They
expressed an interest in learning more
about typical asset classes, such as
stocks, bonds, mutual funds, CDs, and
real estate. Investors should consider
tapping into online educational
materials and tools to help increase
their investing confidence, while
advisors should consider adding this
information and related tools to their
Web sites, and discussing investment
topics during client meetings.
The emerging affluent are also tech savvy
The emerging affluent are comfortable
working with their advisor via voicemail,
email, and/or phone. The availability
of online tools and resources also
helps with their investment decisions.
Investors should consider expressing
their communication preferences
to their advisors and discussing the
types of online capabilities that are
helpful. Advisors should consider
evaluating their touch points and online
offering to further enhance the client
experience. This will be especially
important given that 40% of emerging
affluent investors surveyed feel that
an advisor can be replaced by online
automated investment tools. With
the advancement of digital advice
and do-it-yourself (DIY) capabilities,
combining technology with the human
touch may be a strong differentiator
for advisors.
Emerging Affluent
Investor Takeaways
Consider using an advisor, like many wealthier investors

Share your goals with an advisor, and check for understanding

Take steps to manage debt levels, save for your child’s education, and plan for retirement

Access online educational materials from your advisor or other reputable firms to
increase investing knowledge

Evaluate the diversification strategies of wealthier investors, and seek advice about whether
your portfolio is properly diversified
Advisor Takeaways
Emphasize the benefits of professional advice
Focus on debt levels, education, and retirement planning
Involve other family members in financial discussions
Provide educational materials and online tools for clients
Be transparent about pricing, and consider an alternative fee schedule for smaller accounts
68% versus 23%
Percentage of emerging affluent investors
who are female versus deca-millionaires
75% versus 91%
Percentage of emerging affluent
investors who are White/Caucasian
versus all other investors
32%
Among advice users, percentage of
emerging affluent investors who are
interested in receiving college/education
tuition planning
74%
Percentage of emerging affluent investors who
are comfortable working with their advisor via
voicemail, email, and/or phone
9
33%
Mass Affluent
Mass affluent investors want anywhere/
anytime access to an advisor
While there are a number of selection
criteria common to all investors
when choosing an advisor, the mass
affluent also look for an advisor who is
accessible anywhere/anytime. Investors
should evaluate an advisor’s mobile
offering and the degree to which they
are equipped to handle documents
electronically for a paperless
experience. In turn, advisors should
consider adding mobile apps, video
conferencing, and cloud-based access
to information to enable them to work
remotely. This should complement
rather than replace in-person
interactions, since 66% of mass affluent
investors prefer to meet face-to-face.
Important advisor selection criteria for all investors:
• Proven track record
• Recommendation by others
• Advisor knowledge and expertise
enough income for an investor’s
expected lifespan. Should investors
need to tap into their assets to cover
expenses in retirement, advisors may
want to coach them on the most
effective way to take money from their
investments.
Many are sole decision makers
As the mass affluent age, it is important
that both members of a couple are
well versed in their day-to-day and
long-term finances. Investors should
Percentage of mass affluent investors who
are knowledgeable about investing
58%
Percentage of mass affluent investors who
are sole decision makers when it comes
to investing
consider including their partner in a
review of their financial situation and
asset allocation strategy to help bring
them up to speed. Advisors should
consider encouraging joint meetings
and providing opportunities for
partners to become more familiar with
investment matters.
Like the emerging affluent, they need to
build their investing confidence
More mass affluent investors feel
knowledgeable about investing
than the emerging affluent, but the
percentage is still relatively small.
Again, investors should consider
becoming more familiar with the
purpose of different financial
instruments, and advisors should
consider making education a larger
part of the offering, either via
their Web site and/or during client
conversations.
MASS Affluent
Investor Takeaways
Ask specific questions to make sure an advisor will meet your availability and accessibility needs
Help increase savings while still employed
Develop a retirement income plan
Access online educational materials from your advisor or other reputable firms to increase
investment knowledge
Ensure that your partner is well versed in all financial matters, and attend advisor
Retirement planning is a concern for the
mass affluent too
As many mass affluent approach
retirement age, they will need to be
focused on accumulating assets while
they are still employed. Investors
should consider a savings and investing
program that is appropriate for their
remaining working years, and advisors
should consider discussing how best to
transition to retirement and generate
10
meetings together
Advisor Takeaways
Equip your advisors with technology that enables access from anywhere
Develop a plan to help increase savings while the client is still employed
Develop a retirement income plan for clients
Involve both partners in financial discussions
Make sure your communication strategy includes educational materials to help clients
stay informed
Wealthy Investors are More Diversified Than Others
Percentage of Investors
Holding Different Asset Classes
Emerging
Affluent
Mass Affluent
Millionaires
DECA-MILLIONAIRES
Alternative investments (e.g., private equities, structured
products, hedge funds)
20%
14%
20%
40%
Annuities
32%
40%
Individual domestic bonds
20%
27%
Individual domestic stocks
43%
64%
44%
39%
75%
34%
58%
69%
Certificates of deposit (CDs)/money market accounts/cash
equivalents
42%
47%
56%
49%
Equity exchange-traded funds (ETFs)
20%
20%
Domestic bond mutual funds (including lifecycle funds)
27%
Domestic equity mutual funds (including lifecycle funds)
25%
37%
42%
34%
52%
54%
37%
54%
56%
Domestic blended bond and equity mutual funds (including
lifecycle funds)
18%
29%
35%
32%
International mutual funds
24%
29%
45%
41%
Real estate investments (including real estate investment
trusts, but not including primary residence)
31%
31%
43%
54%
International/emerging individual securities
16%
20%
29%
42%
Managed accounts (e.g., separately managed accounts,
wrap accounts)
26%
24%
33%
40%
Millionaires
Many millionaires want advisors to
be validators
In addition to the criteria highlighted,
millionaires also look for an advisor that
shares their investment philosophy.
Just under one-quarter (24%) delegate
investment decision making to their
advisor, while many more look to an
advisor for validation of their decisions,
making alignment of the approach
important. Millionaires also worry
about maintaining their lifestyle in
retirement, and will likely want an
advisor who can help them address
this concern.
Investors looking for support should
consider evaluating an advisor’s
approach to asset allocation and
rebalancing, while advisors should
consider being transparent about their
overall philosophy and investment
style during the sales process, and
discussing retirement planning.
They use a broad range of
financial vehicles
While views on risk, return, and the
complexity of specific investments
remain consistent across wealth
groups, investing styles evolve
with wealth. More millionaires who
participated in the study include
bonds, real estate investments, and
managed accounts in their portfolio
than the emerging or mass affluent.
In addition, more millionaires include
individual domestic stocks in their
portfolio than all other investors.
44%
Percentage of millionaires who
validate investment decisions with
an advisor
61%
Percentage of millionaires who are
active users of technology when it
comes to financial activities
69%
Percentage of emerging affluent and
millionaires who expect technology to
be part of managing their finances
11
Millionaire investors should consider
reviewing their asset allocation
strategies to see if they are properly
diversified. In addition, emerging and
mass affluent investors should look
at the financial vehicles being used
by millionaires to see if this can guide
their own strategies. With 23% of
millionaires being concerned about
maintaining their household’s wealth,
advisors should consider discussing
suitable portfolios for asset protection
as well as growth.
Active Use of Technology is Common
with Millionaires
Millionaires are active users of
technology when it comes to financial
activities — just like the emerging
affluent. Similarly, millionaire investors
should consider reviewing the type
of technology being used by an
advisor during the sales process, and
encourage their existing advisors to
adopt new technologies to improve
how they work together. Advisors
should assess which applications
investors value most. Since a number of
industries have raised the bar in terms
of providing engaging and seamless
experiences for consumers through
technology, it has become even more
important for advisors to keep pace.
12
Deca-Millionaires
MILLIONAIRES
Investor Takeaways
Assess an advisor’s investment
philosophy to make sure it aligns
with your own
Ensure that your partner is well
versed in all financial matters, and
attend advisor meetings together
Consider a more conservative
investment strategy as retirement
nears
Work on a retirement income plan
Ask specific questions to assess
whether an advisor uses technology
to facilitate working together
Advisor Takeaways
Have a transparent approach to
investment management
Discuss a plan for asset protection
and growth with clients
Develop a retirement income
plan for clients
Involve both partners in financial
discussions
Evaluate your technology
strategy to ensure you are
providing an easy and enjoyable
client experience
Deca-millionaires tend to use
multiple advisors
Like millionaires, deca-millionaires
look for an advisor who shares the
same investment philosophy. They also
value having a personal connection,
and many (40%) turn to their advisor
to validate their decisions. Decamillionaires are also more likely to
use two or more advisors than any
other segment.
Deca-millionaire investors should
consider spending time getting to
know an advisor before agreeing to
work together to see if the dynamic is
right and the advisor is comfortable
in the role of validator. Advisors will
need to broaden their discussions with
these investors to create that personal
connection and strive to become one
of the main advisors being used.
They use a broad range of
financial vehicles
More deca-millionaires hold assets
such as alternative investments,
derivatives, and individual emerging
market securities than other wealth
groups. These investors may want to
continue learning more about these
asset classes, and adjust their asset
allocation as market conditions change.
Since reducing taxes is a major concern
for these ultra-wealthy households,
advisors should consider helping
them manage their portfolio for
tax efficiency.
5 | Summary
Wealth transfer is a concern for
deca-millionaires
Not surprising given the assets they
have accumulated, estate planning is
one of the major concerns facing decamillionaires. Investors should consider
reaching out to a professional to create
a suitable plan for transferring wealth,
and doing so in a tax-efficient manner.
Since deca-millionaires are the largest
group of sole decision makers, advisors
helping with investment or estate
planning should ensure that other
family members are involved.
Deca-millionaires also use technology
Technology is also important for decamillionaires, and 59% are active users
when it comes to financial activities.
Many use technology to simplify or
reduce investment management
and financial planning issues. Again,
investors should consider reviewing
the type of technology being used by
advisors, and advisors should consider
adding other online capabilities
to stay relevant and enhance the
client experience.
DECA-MILLIONAIRES
Investor Takeaways
Have in-depth discussions before
choosing an advisor to establish a
personal connection
Assess an advisor’s investment
philosophy to make sure it aligns
with your own
Learn more about financial vehicles
that support tax-efficient investing
Develop an estate plan
Involve your partner and adult chil-
Looking at similarities and differences
among groups across the wealth
spectrum can help provide interesting
insights for investors and advisors
regarding strategies for maximizing
wealth. Adopting some of the ideas
in this paper may help investors as
they strive to achieve their goals. In
addition, advisors may find new ideas
for enhancing the way in which they
serve clients, helping these investors
move across the spectrum.
dren to ensure a smooth transfer of
wealth, when the time comes
Advisor Takeaways
Have a transparent approach to
investment management
Build a plan to deepen your
personal connection with each
client through events,
communications, meetings, etc.
Discuss tax-efficient investment
strategies and estate planning
with clients
Learn more:
2 Digging into Digital Advice
2 Millionaires of Tomorrow
lan, Diversify, and Differentiate:
2 P
Three Strategies of High-Performing
Advisors
Invite both partners to every
meeting to foster strong
relationships with each member
of the couple
64%
Develop a specific plan to establish or build relationships with the
adult children of your clients
Percentage of deca-millionaires who
are knowledgeable about investing
75%
Percentage of deca-millionaires
who are sole decision makers
64%
Percentage of deca-millionaires
who use technology to simplify/reduce
investment management/financial
planning issues
13
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The experience of the millionaires who responded to the Fidelity ® Millionaire Outlook survey may not be representative of the experiences of all
investors and is not indicative of future success.
Bellomy Research is an independent third-party research firm and is not affiliated with Fidelity Investments.
The content provided herein is general in nature and is for informational purposes only. This information is not individualized and is not intended to
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