Cost main barrier to advice take-up
Cost has become the main barrier to a higher take-up of financial advice, which suggests poor perception is not the main problem for the industry any more, according to CoreData's 2012 Financial Planning Shadow Shop.
Of the 319 people who made an appointment with a financial planner as part of CoreData's shadow shop, 44.6 per cent said the planner could improve their situation.
However, only 11.2 per cent said they would proceed to use their planner and pay for advice.
"I think it is a positive step for the industry that more people are seeing the value of advice in that they understand that this person can add value, but in the current environment where people are very much focused on staples and rising bills they're finding it hard to justify paying for advice," said Kristen Turnbull, head of advice, wealth and super at CoreData.
Turnbull said soft client engagement skills - the ability of the adviser to enthuse the client - had also become one of the most important factors in taking on new clients.
"Planners who were not able to [sign a client] had come across as more mechanistic and focused too much on the compliance side; they tend to struggle to engage the client," Turnbull said.
"So while those compliance elements are important to tick off, it can't be too much of a focus, otherwise the client feels that they won't actually be able to build a relationship with a planner."
In terms of what clients look for in a planner, honesty and transparency remained key - as well as value for money, according to CoreData's report.
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