Are You Happy With Your Financial Adviser?

Financial advisor talking to couple on sofa
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"Widen the moat, build enduring competitive advantage, delight your customers, and relentlessly fight costs."
-- Warren Buffett, CEO of Berkshire Hathaway

"Satisfied employees mean satisfied customers, which leads to profitability."
-- Anne M. Mulcahy, former CEO of Xerox

"Your employees come first. And if you treat your employees right, guess what? Your customers come back, and that makes your shareholders happy. Start with employees and the rest follows from that."
-- Herb Kelleher, co-founder of Southwest Airlines

CEOs know: Happy employees are the key to happy customers. But which financial services companies do the best job of keeping their employees happy -- so that they can turn around and make you happy?

J.D. Power, the powerhouse of customer satisfaction and product quality surveys, recently conducted two surveys that shed some light on this employer-employee-customer dynamic, and they've come up with some surprising findings that might be important to your financial portfolio.

Happy Customers

Three months ago, J.D. Power published the results of a survey of customer satisfaction at 18 different "full service" investment advisers. Six companies stood out from the pack, scoring at or above the industry average and winning five "power circles" worth of endorsement from J.D. Power:
  • Edward Jones and Fidelity Investments tied for first place, with each scoring 812 points out of 1,000 on J.D. Power's "overall investor satisfaction index."
  • Charles Schwab (SCHW) and Wells Fargo (WFC) tied for second place, with 810 points each.
  • Raymond James (RJF) also scored above the "industry average" of 807 points, with 809.
  • And Ameriprise Financial (AMP) tied the industry average.
Further down the rankings, no investment advisers won four "power circles" from J.D., but four received three circles, and eight companies received subpar two-circle ratings.

Happy Employees

Now here's where things gets interesting. One of those last eight laggards was Morgan Stanley (MS) Wealth Management. And as (bad) luck would have it, Morgan Stanley also featured in a later J.D. Power survey of employee advisers' satisfaction with their employer firms.

And when we say "featured," what we mean is "landed in last place." In this survey of investment advisers' satisfaction with their employers, Morgan Stanley was the only company, out of seven reviewed, to receive a below-average two-circle score from J.D. Power.

It seems no one's very happy at Morgan Stanley these days -- not its customers, and not its employees, either.

In contrast, four of the top-ranked firms on the "investor satisfaction" survey also ranked above average on the employee adviser satisfaction survey -- Edward Jones again topped the survey, followed by Raymond James and Charles Schwab. Wells Fargo also scored above average (if only just barely). Fidelity and Ameriprise weren't rated in the employee adviser survey.

What It Means to You

If you like doing business with people who like their jobs -- and really, don't we all? -- then the obvious choice based on these two survey findings is Edward Jones. Whatever you think of investment advisers in general, the top-ranked shop in two separate surveys can't be all bad.

Raymond James and Charles Schwab also receive generally high marks, and should make for decent choices as well.

In contrast, one shop you might want to cross right off your list of potential investment advisers is Morgan Stanley. They don't score highly among their existing clients. Their employees don't seem especially thrilled to be there. Judging from the data, it's hard to imagine you'll feel any better about the experience, either.

Motley Fool contributor Rich Smith has no financial (or other) relationship with any of the companies discussed above. He does his investing solo ... but if truth be told, he isn't always "five-circles satisfied" with his own performance, either.

The Motley Fool recommends and owns shares of Wells Fargo. Try any of our Foolish newsletter services free for 30 days. Try any of our Foolish newsletter services free for 30 days. Check out our free report on one great stock to buy for 2015 and beyond.
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