Consumers are increasingly seeking financial advice to gain assurance about their future rather than looking for specific retirement goals, but are reporting higher levels of confidence after engaging with a professional, new research from Russell Investments has revealed.
The investment firm yesterday released the “2026 Value of an Adviser Report”, based on research conducted earlier this year by Honeycomb Strategy, which stated reassurance had overtaken retirement planning as the number one reason Australians were seeking advice.
The survey of 501 advised investors, 200 non-advised investors and 237 financial advisers conducted over April and May found 43 per cent of respondents who seek advice do so for reassurance, compared to 38 per cent who do so for retirement planning.
Russell Investments Australia and New Zealand head of distribution Neil Rogan noted at the same time competing financial goals rose from 23 per cent to 31 per cent as a driver for seeking advice, reflecting the changes in demographics of potential clients.
“I think that [change] is reflective of some of the choices of people in my generation are facing and people would say we [generation X] are the sandwich generation,” Rogan said, adding many in that cohort have teenage children, aging parents and limited finances, and struggle to balance these competing priorities.
“One adviser in our research really captured the shift particularly well [saying:] ‘Clients don’t care about the 50 investment options in their portfolio. All they want to know is, am I going to be okay?’”
Honeycomb Strategy head of client service Jason Morris pointed out this was a common theme in consumer-facing analysis, given the rising cost of living and property prices.
“People are feeling more stressed than ever and really wanting to have that sense of control, but also reassurance and being able to cut through the noise is really what they’re looking for from advisers,” Morris indicated.
Rogan recognised when advice had been sought and adopted, respondents reported a marked shift in their confidence to reach their financial goals, with 83 per cent stating they were very or extremely confident after taking this course of action, compared with 41 per cent before doing so.
“This is another critical output of the research, before receiving advice and having confidence in achieving a goal, literally the level of confidence more than doubles after receiving advice,” he explained.
“This is a real key point and the other piece is around the value for money, with 90 per cent of clients saying their adviser is providing excellent or good value, despite the average fees being around $5000 per annum.”
Jason Spits
SENIOR JOURNALIST
Jason is a senior journalist with Benchmark Media and writes for the selfmanagedsuper website and magazine and smstrusteenews website. He has covered financial services since 1999 and has written about life insurance, superannuation, investment management and financial advice, in both a freelance and in-house capacity, and also did a brief stint as a media manager for an industry association. He has been the editor of trade titles Money Management and Financial Standard, and was most recently senior journalist with life insurance title Riskinfo.
Articles by Jason