What builds investment conviction after inheritance?

An inheritance can bring a sudden increase in financial responsibility, sometimes forcing inheritors into making high-stakes decisions before they feel ready. Faced with competing priorities, complex assets and conflicting advice, many inheritors struggle to move with confidence from consideration to action. The challenge for financial advisers is to help an inheritor develop the conviction to act.

Analysis paralysis quells conviction

New research from Capital Group finds that nearly half of inheritors cite too many options or conflicting advice as among the biggest challenges they face when managing inherited wealth. More than a third struggle to balance immediate needs against long-term goals; 35 per cent find managing and consolidating assets complex; and 32 per cent point to the emotional complexity of inheritance.

Michael Viana, Head of Wealth Transfer at UBS Global Wealth Management, says that the volume of information can exacerbate the problem. “More information doesn’t necessarily mean it’s better information or it creates more conviction.” He adds that advisers need to make information understandable and relevant to the individual client, presenting a manageable set of options.

Only 18 per cent of inheritors feel very comfortable making decisions in the first few weeks after receiving their inheritance. Similar uncertainty appears in whether people act on advice: less than half say they acted comprehensively on the advice they received.

Sumeet Bhambri, Global Head of Advisory and Managed Investments, Wealth Solutions, Standard Chartered says conviction grows when clients understand the implications of a decision, the trade-offs involved and how it fits within their broader objectives. “The best advisers help clients simplify complexity, focus on the decisions that matter most and stay disciplined through market cycles.”

How trusted relationships build conviction

Trust appears to play an important role, with 78 per cent saying that an existing adviser relationship was particularly valuable when they inherited wealth. But an adviser’s communication style, age and gender are also particularly important.

Emma Wheeler, Head of Women’s Wealth at UBS Global Wealth Management, says advisers can build confidence by slowing the process down and working alongside clients “at their pace”, rather than rushing them or leaving them to navigate unfamiliar decisions alone.

The support that advisers offer can influence whether clients follow their advice. As many as 39 per cent say convenient access to advice helped them to act, while 38 per cent point to advice that was clear and easy to follow.

Wenxian Yeo, Head of Wealth for Asia South and CEO of Citibank Singapore, explains that advice that inspires conviction is rooted in “clarity, collaboration and trust.” Yeo says that clients need to understand the rationale behind a recommendation and feel involved in the decision-making process. That way, advice becomes something they can own, rather than passively receive.

Drawing on several sources of advice

Inheritors draw on a mix of sources when making decisions. Around nine in 10 consult a professional financial adviser; 67 per cent use digital platforms or robo-advisers; and around three in 10 turn to social media or financial influencers.

Different channels can serve different purposes. Lavanya Chari, Head of Wealth and Premier Solutions at HSBC, explains that clients draw on “digital platforms, AI tools, social networks or traditional financial advice” before speaking to an adviser. By drawing on several sources, inheritors can sense-check decisions before they act, which is a process that instils confidence.

Advisers can help inheritors build conviction for better investment outcomes

Building conviction in a new investor takes time and experience. Trusted advisers can give inheritors the clarity to make decisions when priorities compete or information becomes overwhelming. The goal is to help clients feel confident enough to act without rushing them into decisions they are not ready to make. As the sources of financial guidance continue to multiply, human judgment will be increasingly valuable.