An estimated 1.8 million Australians are currently receiving financial advice but that figure has declined by 100,000 per year for the last two years according to Investment Trends.
In its 2021 Financial Advice Report, the researcher says an estimated 12.6 million Australians now have unmet advice needs, with 40 per cent saying they can’t afford advice and more people leaning on their super fund for guidance.
“Over the past decade, the number of Australians relying on professional financial advice has fallen significantly,” Investment Trends says. “Perceived high costs and lack of investible funds remain the main barriers to seeking financial advice among those who have unmet advice needs.”
An estimated 3.2 million consumers are estimated to be open to engaging with a financial adviser in the next two years, the group states.
“The pandemic has prompted many to consider their financial situation and many Australians are now looking to expedite their decision to seek or consider advice options,” says Kurt Mayell, associate research director at Investment Trends.
“Over the next two years, there is likely to be significant demand for advice in areas such as tax reduction strategies, capital preservation, and ESG investing.”
The report notes several positive developments for advisers, including an increase in the proportion of advised clients who believe their position has improved as a result of financial advice; the average portfolio of these clients increased by $140,000, the researcher says.
“Loyalty has also increased among advised clients, with 75 per cent of advised clients intending to continue their existing adviser relationship, up from 62 per cent in 2020,” Mayall adds. “Honesty and integrity are key considerations that new advised clients look for when selecting an adviser by a significant margin, followed by independence.”
What an absolute mess!
This is what happens when you have people at the wheel who have no idea what they are doing. They should hang their heads in shame instead of gloating over the size of their RC payday.
The regulator has focused so much on what doesn’t matter (product) and nothing on what really matters, (advice and people).
They’ve listened too much to the noise and not enough to the professionals. If the money they spent decimating the industry had been spent on the conduct of the minority then the right people would have been targeted.
Now a large number of good advisers have left this industry and a lot more will go when the retrospective education standards are enforced.
Advice costs have spiraled, people have been pushed into products based on price and the net benefit to the naive end user is confusion, disengagement and asking the trusted adviser to please explain what the hell has happened.
Soon, they will have no one to ask other some dimwitted actor on an escalator.