Behavioral Nudges Boost Financial Advisors' Client Acquisition by Millions
Financial Advisors often struggle to attract new clients, so this study looked at using psychological nudges to help. Nudges are prompts that encourage people to do things that are good for them. The researchers wanted to understand why most investors don't have a Financial Advisor and how nudges could change that. They found that certain types of overconfidence in investors affect whether they seek financial advice. By using nudges, even a small increase in response rates could lead to millions more investors working with Financial Advisors, benefiting both parties.