16 September 2015

How does your personality influence your choice of adviser?

You’ve worked hard to climb the corporate ladder, have attained a high-income position, and have managed to create a savings nest egg. But are you missing out on even greater wealth by leaving your money in low-interest-bearing accounts rather than taking the next step and investing? Successful people don’t all have the same approach to investing. The study of psychographics has identified nine distinct personality types that define the attitude that financially successful people have towards investing, and your high-net-worth personality can have a significant impact on what type of adviser you should look for, and the type of relationship you are likely to have with them.

1.     Family Steward. At the name suggests, your principle focus when considering investing is to provide financial security for your family, with goals such as ‘providing a good education for my children’ or ‘saving enough to make sure my husband or wife and children are well looked after when I’m gone’. With family security being your focus, you are likely to prefer conservative investment options, which may produce slightly lower returns but will also have lower levels of risk. Don’t be concerned if you have little or no previous knowledge of investing, but take the time to find a financial adviser that understands your priorities (this applies to all nine personality types) and who is accepting of your goals. You are likely to feel most comfortable with an investor who takes an interest in your family as well as your money. In doing so, they are more likely to have a real sense of what your investments are for.

2.     Independent. Along with Family Stewards, Independents make up more than fifty per cent of high-net-worth individuals. If you view the accumulation of money as a means to an end, you most likely fall in this category. One aspect of this personality type is that you are more interested in the goals (world trip, retiring early, owning your dream home) than in the details of the investment process. Look for an adviser that you trust to organise the technical details of your investments in order for you to achieve your dreams and aspirations.

3.     Investment Phobic. If you are uncomfortable discussing financial matters, despite your personal success, then you probably fall in this category. Don’t be put off by the fact that investing may appear to be a world that you have no interest in and little understanding of. Look for an adviser who is able to coax you into sharing your aspirations and provide you with financial solutions to achieve those aspirations without bombarding you with technical details or requiring too much ongoing input from you. Ideally they will be able to explain what they are doing, and why, in layman’s terms rather than trying to impress you with their industry-specific jargon.

4.     Anonymous. You might have money, but if you prefer that no one knows that, then you are likely to be in the Anonymous category. The Anonymous can have varied levels of experience and understanding of investing – the defining characteristic of this category is privacy, which is also the key focus in your search for a suitable adviser. While all advisers should have a standard confidentiality agreement that ensures a certain level of anonymity, the ideal adviser for you will make client privacy of paramount importance.

5.     Mogul. As a Mogul, you are decisive and willing to take responsibility for your actions, with your main concern being the desire to maintain control of your investments. Look for a financial adviser that will provide the professional service you require while allowing you to have final say over all key decisions. Keep in mind that if you retain the services of an adviser, they have a certain level of legal responsibility for your investments, so there may be times where compromise is required.

6.     VIP. If your primary goal for investment success is to be able to afford prestige brands (such as European cars and brand-name items), you are most likely a VIP. If most of your funds are tied up in non-investable assets (things like designer-label goods fall in this category), you might like to look for an adviser that is initially able to help you develop a savings budget that will allow you to grow your investment portfolio enough to provide the returns necessary to live the life you want.

7.     Accumulator. Is your focus for investing tied to increasing the size of your portfolio? An Accumulator looks to increase their long-term savings, often at the expense of short-term spending – frugal living allows for more money to be set aside to invest. Ideally, you will find an adviser that understands your focus on high-performing investments rather than other, less measurable milestones of success.

8.     Gambler. If you enjoy the thrill of direct involvement in your investments – looking for the next big win from your portfolio – you may be considered a Gambler. Because of your hands-on approach, you might decide an adviser is unnecessary. This is certainly your right, but depending on your level of investing knowledge and experience, you might also like to consider looking for an adviser who is willing to split your portfolio – leaving you with complete control over one portion in order to satisfy your passion for investing, while managing the other portion of your portfolio in a more traditional manner.

9.     Innovator. Are you constantly searching for the latest technological advances? Innovators are always on the lookout for new products, either as a tool to improve investing success (new apps to improve market research), or as a direct investment opportunity (leading-edge technology companies that could skyrocket in share price). Like Gamblers, Innovators take a very active role in their investments and may choose to follow their own advice; however, if you do want a professional opinion, look for a progressive adviser who is up-to-date with new developments and who is able to provide you with the required information about new products necessary to ensure educated investment choices.

There you have the nine personality types of high-net-worth individuals. Like any personality profile, things are never black and white, so you may see yourself in more than one category. If you can ascertain which is your most dominant characteristic, you should find the above suggestions helpful when looking for an adviser.

One other point – don’t get too hung up on the labels. If you find yourself leaning towards a category but don’t think the label fits your personality, remember that it doesn’t define who you are as a person, it simply describes your view towards investing money.


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