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Advisors Spend Less Than 20% of Their Time Meeting Clients, Study Claims

By Garrett Keyes March 26, 2019

Financial advisors are spending less than 20% of their time in client meetings, a Kitces.com survey shows.

“If 80% of advisors’ time is consumed with back-office and administrative tasks, they may only see clients once or twice a year,” Michael Kitces, director of wealth management at $2 billion Pinnacle Advisory Group, says. It’s “hard to retain clients like that.”

And heavy administrative and back office burdens may be the cause of such meager contact time with clients, the survey of over 1000 FAs seems to indicate.

The “bulk of what advisors get paid for is to spend time with clients,” Kitces claims. Advisors not spending enough time with clients either “lose them, can’t command as high of a fee, or can’t take on any new clients,” he says.

The average FA spends 43 hours per week working as a financial advisor, the study suggests. About 18 hours of that time is spent on investment management, administrative, professional development, and business management tasks.

Client meetings only occupy around nine hours a week in comparison.

Financial technologies have “a long way to go to further enhance advisory productivity and reduce back-office administrative tasks that take up a third of advisors’ weeks,” Kitces writes in a press release. “The promise of all this financial technology and outsourcing tools is supposed to be more efficiency.” But advisors “still don’t have enough time to see clients.”

Advisors should acknowledge that financial technology “has a long way to go before automating advisors’ daily tasks,” says Kitces.

But Paul West, managing partner of the Carson Wealth Management, says FAs might not be harnessing technology to its fullest potential.

The study’s claim that advisors spend 18 hours weekly on administrative and operations tasks “looks high to me,” West says. His firm uses Salesforce, Orion, eMoney, Ignite Technologies, and other technologies for administrative and back office duties and claims the time he spends using this technology is “very minimal.”

Most advisors are significantly behind in using technology efficiently, West says.

“Advisors all have the same tools to build a house,” but West says advisors need to know how to use the tools better. “Salesforce is like a spaceship. It has more buttons and workflows than you can imagine.” But the average RIA doesn’t have time to build out the most efficient process using those resources, he says.

Michael Kitces

At $1.7 billion AUM RIA Courier Capital, advisors spend between 30% and 40% of their time face-to-face with their clients, Michael Brace, the firm's senior portfolio manager, says.

Including “casual catch-ups,” client communication takes 60% of a Courier advisor’s time, he says.

“Technology has definitely helped” the firm streamline back-office and administrative duties to give FAs more time to meet clients, Brace says. “The advisor-client personal relationship is the key element” to a successful FA relationship.

When advisors don’t spend enough time meeting and interacting with their clients “there are obvious consequences,” Brace warns.