As a new presidential administration takes over in Washington D.C., most advisers believe the change will be favorable for markets and the nation’s pandemic response … but don’t expect them to broadcast those views. Many advisory firms have held off on sending election-related communications to their broad client base.
The findings are part of an ongoing research series exploring changing business practices and attitudes in a world shaped by politics and the pandemic. The latest survey, taken in mid-November, looked at how advisers felt about the election results, and whether they were discussing it with clients.
Many advisers believe the election results will bode well for financial markets, with half of those surveyed expecting the election to have a “very” or “somewhat” positive effect on markets over the next year. Only 35% believed the election would have a negative impact on markets. The rest indicated it would have no major impact.
While advisers felt positive about the market impact of the elections, that didn’t mean there weren’t concerns. More than half of surveyed advisers believe the change in administration will be unfavorable for the financial industry regulatory environment and the regulatory burden placed directly on their firms. Many advisers were also concerned about the impact on their clients’ tax burden.
However, most advisors (58%) believed the new administration would be favorable when it came to the pandemic response. A majority of advisors (72%) also liked the prospect of greater economic stimulus under President Biden’s administration.
Election Won’t Be Game Changer to Advisers’ Approach
While advisers may expect a more stringent regulatory environment during the coming administration, they aren’t expecting wholesale changes in their approach to advice. Only 9% of advisers say the election outcome will “significantly” change how they approach advice. On the other end of the spectrum, half of surveyed advisers expect only slight changes to their approach or no change at all.
Many Advisers Have Shunned Mass Communications About the Election Outcome
As a new president takes office, advisers don’t expect politics to fade in the rearview mirror. Thirty-seven percent of surveyed advisers expect politics to come up more often with clients now that the election is over. Only 22% expect politics to come up less.
The results indicate many advisers believe politics remain a hot-button issue in society. In light of that, they are taking a guarded approach in how they discuss politics with clients. More than half (54%) of surveyed advisers said that, aside from conversations with individual clients, they have sent zero mass communications (i.e. newsletters, email updates or social media posts) since the winner was projected. Only 18% had sent more than a couple communications to their broader client base.
Better to sit and wait, many advisers reckon, than to wade into a political firestorm.
Transamerica Resources, Inc. is an Aegon company and is affiliated with various companies which include, but are not limited to, insurance companies and broker dealers. Transamerica Resources, Inc. does not offer insurance products or securities. The information provided is for educational purposes only and should not be construed as insurance, securities, ERISA, tax, investment, legal, medical or financial advice or guidance. Please consult your personal independent professionals for answers to your specific questions.
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