Why Data Visualization is Important for Financial Literacy
Have you ever experienced the following:
You’re in the middle of a meeting with a client and they ask a question about their portfolio. Maybe they’re curious about their performance return, or maybe they simply want to know the benefits of contributing more money to one account over another.
As you begin to walk through your explanation, you realize you’ve gone on a little longer than you anticipated...and then you can see their eyes start to glaze over a little...and then, you’ve completely lost them.
Complex situations are almost always improved by the inclusion of visuals. Sometimes verbal communication isn’t enough to get your point across in a way your client can understand.
What you need is data visualization.
And when you’re trying to improve financial knowledge, graphic representation of data can play an even more important role.
Why Financial Education is Necessary
If you work with affluent clients already, you might think ongoing financial education isn’t necessary for your relationships.
But more wealth doesn’t necessarily equate to higher financial literacy. Don’t make the critical mistake of assuming your clients have a solid foundational understanding of how to spend, save, and manage their money because can prevent them from reaching their financial goals.
In fact, a mere 38% of advisory clients said in a recent survey that they feel “extremely confident” they would be able to use the information their advisors give them.
When you provide advice, it’s not enough to tell a client what to do. You also need to make sure they understand why they need to follow your advice. In fact, a mere 38% of advisory clients said in a recent survey that they feel “extremely confident” they would be able to use the information their advisors give them.1
When you provide advice, it's not enough to tell a client what to do. You also need to make sure they understand why they need to follow your advice.
Your Clients Want Visual Presentations
Remember when you were in school, and you had to listen to a professor drone on in a lecture for an hour with no visual aids?
It was tough to follow, and unless it was a class you loved, it was also probably pretty boring.
Tradition tells us that in wealth management, too many advisors follow the professor model of communication. They talk a lot, maybe point out a few complex charts, but don’t involve clients with relatable visuals that engage their imagination and simplify the concepts they want them to understand.
Your clients know this, and they wish you would provide more engaging visuals for them to reference during meetings.
A full two-thirds of investors say they want their advisor to do more to visualize the data shown to them.2 They don’t want more charts—they want visuals that clearly help them see how their different investment vehicles support each other, and what their total financial picture looks like.
The advisors who are able to provide engaging visualizations to their clients are the advisors who will enjoy deeper client relationships, and will see their businesses grow.
Adding Data Visualization to Your Firm
Your clients want better visuals to go along with your advice, and giving it to them can increase the likelihood of them following through on your recommendations.
The only thing left to do is decide on how to best implement data visualization in your firm.
When you work with Asset-Map, you can immediately provide your clients with the kinds of visual information they want. You can put their entire financial life on a single screen so they can understand what they have, what they might be missing, and how it all works together to get them closer to their goals.
The only thing left to do is decide on how to best implement data visualization in your firm.
Ready to learn more about how data visualization can deepen your client relationships? Click here to download our new white paper to learn more about how visuals affect financial literacy.
1. Digital Wealth Management: Winning Clients in the Era of Hybrid Advice. FactSet. https://advantage.factset.com/digital-wealth-management-series-confirmation?submissionGuid=be97e5ae-af32-4387-97b4-2013a07009b8
2. Digital Wealth Management: Winning Clients in the Era of Hybrid Advice. FactSet. https://advantage.factset.com/digital-wealth-management-series-confirmation?submissionGuid=be97e5ae-af32-4387-97b4-2013a07009b8