Average Client Retention Rate for Financial Advisors

New client acquisition is essential for growth, but retaining the clients you already have is how you build a solid foundation for your business. Measuring your client retention rate against industry averages can offer insight into what you may be doing right, or wrong, when it comes to your firm. Read on to learn where the typical advisor stands when it comes to maintaining their client list.

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What Is the Average Financial Advisor Client Retention Rate?

Previously, we reported that the average financial advisor client retention rate was around 95%, according to industry research. A 2024 RIA benchmarking study from Charles Schwab puts the average retention rate at 97% industry-wide¹. That figure represents only registered independent advisors included in the study, but it still offers an encouraging snapshot of the overall health of the industry.

Client retention is of real concern for advisors, particularly as the population ages. Here are some key insights:

• Forty-three percent of advisors say they’re concerned about retaining assets from client spouses or heirs, according to the 2024 Global Survey of Financial Advisors conducted by Natixis².
• The same survey found that 52% of advisors stress the importance of developing relationships with client heirs.

As the great wealth transfer gets underway, you don’t want to be the advisor who misses out on keeping some of those assets under your management. Focusing on client retention and building bridges with the next generation are key when it comes to your firm’s long-term health.

Why Financial Advisors Lose Clients

Why do clients leave their advisors? The reasons vary, but for many, it’s simply about fit. Here’s a sampling of insights about why clients choose to move on in search of a new advisor:

• Among affluent investors, 38% cite diversification as the reason for making a move, while 25% seek better investment performance, according to a Cerulli report³.
• Poor communication could cause a client to look elsewhere. Three out of four clients considered leaving their advisors in 2023, and a lack of communication was linked to low levels of confidence, according to a YCharts survey⁴.
• Sixty-one percent of clients say a lack of trust would cause them to leave their advisor, while 54% cite underperformance, according to the 2025 Investor Engagement Survey from Logica Research and CapIntel⁵.

Lack of engagement or connection, limited tech capabilities or a personality mismatch could also contribute to the end of an advisor-client relationship. Once you know why clients are prone to leaving, you can better avoid any potential pitfalls that could cost you business.

Improving Client Retention Rates: Tips for Advisors

Improving retention rates isn’t rocket science, but it does take some effort on your part. At its core, retaining clients is about figuring out exactly what they need and delivering it to them consistently.

Consider these retention strategies to keep your clients loyal and satisfied with your services:

• Anticipate client needs, rather than waiting for them to tell you what they need. Consider researching behavioral finance to get a feel for how people think about money and how those thoughts motivate their actions.
• Express appreciation through client events, thoughtful cards or notes, or just a quick phone call to let them know you value their business.
• Tailor your communication methods to your clients’ preferences. If you’re not sure how often your clients would like to hear from you or by what means, ask.
• Be responsive and practice active listening. Active listening means giving your clients room to speak and using visual or auditory clues to let them know you hear them and are fully absorbing what they have to say.
• Leverage technology to make your clients’ lives easier. Offer a seamless digital onboarding experience to new clients, or give them access to a secure dashboard or portal they can use to track their accounts.
• Encourage engagement. Close your email newsletters with an invitation to reply with any questions or concerns clients might have. Create social media content that’s interesting and designed to spark conversation, and respond to the comments your clients make.
• Manage expectations appropriately. Don’t guarantee anything you can’t produce, and talk to your clients about what they should expect from you and their investments.
• Continuously offer value. Consider developing new service offerings to better meet client needs and retain their business. Make helpful resources available to clients at no additional charge, or consider hosting educational events they would find enlightening.

Focusing on client retention could also lead to more referrals. The more satisfied your clients are, the more likely they may be to tell their friends, family members or coworkers about your business.

Of course, retention is one part of the growth puzzle. You’ll still need to dedicate some of your time to lead generation to bring new prospects into the pipeline. Partnering with an advisor marketing platform can be a cost- and time-effective way to connect with qualified leads who are ready to work with a financial advisor.

Bottom Line

The average client retention rate for financial advisors is impressive and suggests that clients have faith in the advice they’re getting overall. If your firm’s retention rate is below the average, rethinking your approach to the client experience could help you turn things around.

Tips for Growing Your Advisory Business

• Building a successful practice takes planning and time, and it’s easy to become overwhelmed at the level of work that goes into marketing. If you feel strapped for time or simply want to expand your horizons, you may consider working with an advisor marketing platform. SmartAsset AMP (Advisor Marketing Platform) is a holistic marketing service financial advisors can use for client lead generation and automated marketing. Sign up for a free demo to explore how SmartAsset AMP can help you expand your practice’s marketing operation. Get started today.
• Developing a strong referral program can help you bring in more leads without having to do any direct marketing. As you build your referral program, consider what incentives you’ll offer to your clients for referrals. Advisors can pay for referrals, but there are some important compliance rules you’ll need to observe.

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