Advisors Benefit from Fiduciary Duty Through Affluent Investor Satisfaction
According to a survey conducted by Cerulli & Associates, 70% of affluent investors who believe their financial advisors are consistently required to act as fiduciaries report satisfaction with their advisory relationships and have no intention of seeking new advisors.
Among affluent investors, satisfaction with financial planners varies significantly based on perceptions of their advisors’ priorities. Specifically, only 41% of those who believe their advisors may prioritize their own interests report being satisfied. In contrast, those who believe their advisors adhere to a fiduciary duty—meaning they act in the clients’ best interests—have a satisfaction rate that is 29 percentage points higher, highlighting the importance of perceived fiduciary responsibility in driving client satisfaction.
“Of course, this goes both ways, with individuals who believe firms can prioritize their own interests most likely to be open to a new provider. Still, the key implication remains the same: clients who are confident that they are in a fiduciary relationship are less interested in new providers,” Scott Smith, senior director at Cerulli Associates said. “Firms interested in retaining and building long-term relationships will need to remember to put the needs of clients first or risk attrition.”
Overall, affluent investors express strong confidence in having a fiduciary relationship with their primary financial provider, with only 15% suggesting that their provider might not always be required to act in their best interest. According to Cerulli’s research, clients engaged in banking deposit relationships are more likely to understand that, outside of legal advisor arrangements, the financial institution may prioritize its shareholders’ interests over those of the clients.
“When considering their platform offerings, it is essential that providers embrace the spirit of their role as fiduciaries,” Smith said. “Every product and service on the platform represents the provider, with the firm’s reputation ultimately tied to the least satisfactory client experiences.”
Fiduciary advisors, legally required to prioritize their clients’ best interests, constitute a small yet increasing portion of the wealth management industry. According to 2024 FINRA data, over 85,000 advisors are registered exclusively as “Investment Advisor Representatives,” a designation that carries a fiduciary duty. In comparison, the remaining 628,000 FINRA-registered advisors operate as broker-dealers or in combined roles, typically following a less rigorous suitability standard instead of a fiduciary commitment.
According to FINRA data, the share of fiduciary advisors increased by just over 3 percentage points over the past five years, rising from 8.9% in 2019 to 11.9% in 2024.
Significant growth in fiduciary advisors stems from shifts in the wealth management industry’s preferred fee structures. According to Cerulli, by 2026, more than three-quarters of the industry is expected to adopt a fee-based model, reflecting an increase exceeding 5 percentage points from 2024 levels.