Financial confidence soars for clients with Advisers: new research

Recent research conducted by the Financial Planning Standards Board (FPSB) in collaboration with research consultancy firm MYMAVINS has unveiled a compelling truth – financial advice profoundly impacts the confidence and well-being of Australians. The study, which surveyed over 1000 respondents spanning generations, has revealed a striking difference in financial confidence between those who seek advice and those who don’t.

The survey focused on Australians earning $120,000 or less per annum, a demographic that often faces significant financial challenges. The findings underscore the pivotal role played by financial advisers in enhancing financial resilience and overall quality of life.

Remarkably, 75% of those who have enlisted the guidance of a financial adviser expressed heightened financial confidence. This stark contrast highlights the transformative influence of financial advice, particularly in helping individuals navigate complex financial landscapes.

Another striking revelation from the survey is the depth of trust and commitment that advised clients place in their financial planners. An overwhelming 93% of respondents conveyed trust in their financial advisers to act in their best interests. This trust extends beyond mere transactions, with 77% expressing their intent to maintain long-term relationships with their advisers.

A notable generational trend was also observed. Despite the increasing prevalence of digital tools for financial management, two-thirds of Gen Y respondents (born between 1981 and 1996) expressed a strong preference for face-to-face interactions with their financial planners. This preference reflects their anticipation of significant intergenerational wealth transfers, positioning them as a vital demographic for financial planning services.

As the world experiences an unprecedented wealth transfer from Baby Boomers to subsequent generations, adapting financial services to meet the unique needs and expectations of Gen Y becomes paramount. Financial planners are urged to tailor their offerings to ensure that Gen Y can fully harness the benefits of financial planning.

The release of this research coincided with World Financial Planning Day on October 4, reinforcing the invaluable role of financial advisers in enhancing the financial well-being and peace of mind of their clients.

David Sharpe, Chair of the Financial Advice Association Australia, emphasised the research's significance in debunking myths surrounding financial advice. He stated, "Not only do clients who work with a financial planner feel they are better off, they also feel more at peace with their finances, which is especially important as family budgets are strained by the rising cost of living." These findings irrefutably underscore the profound value of financial advice.