In a recent survey, Spectrem Group asked a group of HNW investors if concerns about Bernard Madoff, and his recent Ponzi scheme scandal, would affect their usage of financial advisors, and the answer was no.

A robust 69% said that would make no difference whatsoever in their use of advisors – which is good news for advisors, though somewhat surprising. A previous survey asked investors how Madoff would affect their choice of advisors and many said they would be hesitant to use a smaller firm because of concern about custodial issues. Perhaps it is Madoff’s upcoming trail that has made people feel more confident, but whatever the reason, smaller firms need to communicate that they have the custodial issues handled and how. Though investors are saying they were no affected by Madoff, there may be more to it than previously thought, and now is the time to reassure investors, especially at smaller firms.

The market has by no means rebounded from the pounding it took in late 2008, but the question on the minds of investors and advisors alike, is what will be the investments of the future?

Although HNW investor’s anger is equally spread between the federal government and Wall Street, the challenge for financial providers is that investors can’t easily demonstrate their anger toward the government, but they can and eventually will demonstrate that anger towards firms they believe are responsible. This will lead to investors changing advisors, arguing about fees, or becoming more Self-Directed. Many investors are waiting for the market to stabilize before making any significant investment changes but will make changes in the future...primarily into investments they deem as “safe”.