Staking a Claim in the Competitive Wealth Landscape

Payments Leader

Posted on October 17, 2016

Competitive Wealth Landscape

Staking a Claim in the Competitive Wealth Landscape

Summary:  The ways community and super-community banks are differentiating their wealth management from their competition, particularly the big banks, and how they currently segment their customer bases is important. Regardless of establishment size, wealth managers are collectively shifting toward goal-based approaches and away from annual “scorecards” fixated around year-to-year percentage differences in the portfolio and relation to market performance on the whole. Wealth managers want to make sure their customers’ financial plans are synchronized with their life plans and support them throughout their life stages. With competition seemingly progressing in the same direction, how can community banks stand out from the big players?

 

Key Stats:

  • 79% of millennials prefer financial plans that include a rate of return needs to meet their financial goals
  • 69% of millennials prefer financial plans that include presenting net worth calculation
  • 48% of millennials prefer financial plans that include tax planning advice
  • 42% of millennials prefer financial plans that include a lump sum needed to meet their spending needs
  • 40% of millennials prefer financial plans that involve a spending/budget schedule to avoid withdrawing money too early
  • 36% of millennials prefer financial plans that include estate succession planning guidelines
  • 21% of millennials prefer financial plans that include presenting debt ratios
  • 15% of millennials prefer financial pans that include charitable giving advice and guidelines
  • 69% of investable assets are held somewhere elsewhere than customers’ primary bank

 

Key Takeaways:

One obstacle community banks encounter is how to service the generation of new wealth builders before their wealth has been constructed. Three areas of differentiation associated with providing a high level of personal service with a competitive superiority are structure, distribution and unique product propositions. Facilities segment wealth management customers according to how much investable assets they have to bring to the bank. Although, the points where numerous community and super-community banks make service distinctions vary, the action around segmentation is mostly one of “good, better, best.”

 

Leave a Reply

Payments Leader

Payments Leader from FIS provides insights on credit, loyalty, fraud and emerging payments strategies through blog posts from our industry experienced authors.