ASIC’s Report, Financial advice: What consumers really think, surveyed more than 2,500 Australians about their experience with, and attitudes towards, financial advice and the advice industry.
In addition to 41% of Australians looking to get personal advice from an adviser, 27% have received financial advice in the past while 12% have received financial advice in the last 12 months.
The research found the main statements for using a financial adviser that participants most commonly agreed with were:
- “Financial advisers have expertise in financial matters that I don’t have” (79% agreed)
- “Financial advisers can recommend products I would not normally find on my own” (75% agreed)
- “It is the job of a financial adviser to read the fine print and notify their client of anything important” (74% agreed)
- “Financial advisers can introduce me to good ideas I might not have thought of” (69% agreed)
According to the report, Australians who receive financial advice tend to have higher household incomes than those who don’t, while also tending to keep up with economic trends and keep long-term financial goals.
ASIC commissioner Danielle Press said the good news for the industry was that consumers who had recently received financial advice had more positive attitudes towards financial advisers than those who had not.
“Although not all Australians need financial advice, it is imperative that people wanting advice when making critical financial decisions are able to access high-quality advice and equally, feel confident that the advice is in their best interests,” Ms Press said.
“Financial advisers have an important role to play in helping consumers improve their financial position, and there is a real opportunity for the advice industry to rebuild that trust by reorienting itself and putting consumers at the heart of its services,” Ms Press concluded.
Financial advice came under scrutiny during last year’s Royal Commission, with advisers accused of often not acting in customers’ best interests.
Nearly one in five (19%) of the respondents that hadn’t received financial advice recently said they do not trust financial advisers.
Other reasons commonly-selected by these respondents for not using a financial adviser included:
- Being too expensive (35%)
- Their financial circumstances being too limited for it to be worth getting financial advice (29%)
- They like to manage their finances themselves (26%)
- They don’t see the value in financial advisers (18%)
However, 49% of online survey participants said they didn’t feel financial advisers were acting in their customers’ best interests, and are instead interested in making themselves rich.
“While Australians believe financial advisers can offer significant expertise on financial matters, our research shows that many don’t seek advice because they are put off by factors such as high costs, significant distrust of the industry and a perception that financial advice is only for the wealthy,” Ms Pell said.
Financial planners….as gifts?
With price being a common barrier to using financial advisers, it’s not surprising to learn Australians (especially young Australians) are open to the idea of receiving a financial planning session as a gift.
Research from the Financial Planning Association of Australia (FPA) found 81% of Gen Z and 76% of Gen Y would “value the gift of time with a financial planner”.
57% of all Australians feel this way, indicating a strong overall desire to get professional financial help.
FPA Chair Marisa Broome says this could be a good option for the many parents and grandparents who want to inspire the younger generation to seek the advice of a professional financial planner.
“I’ve been offering gift vouchers in my practice for many years, and it’s so rewarding to see the intergenerational ripple effect of good financial advice,” she said.
The FPA offers gift vouchers that can be bought and downloaded for the purpose of visiting a registered financial planner.