Pre-retirees with advisers are happier
Pre-retirees with financial advisers are happier than those without because they feel more in control of their finances, according to a Fidelity survey.
Speaking at a Financial Planning Association webinar, Jason Andriessen, consulting partner at research consultancy MYMAVINS, broke down the findings of the randomised online survey of 1,500 older Australians, focusing on the pre-retiree cohort.
With 510 of those surveyed making up the pre-retirees, meaning those aged 50 or older in full time work, the survey found pre-retirees to be the least happy compared to those who were semi or fully retired.
Paradoxically, later stage retirees were happier than those in earlier stages, even though health was proven to have a significant impact on life satisfaction.
One of the reasons for this, as Andriessen said, was that pre-retirees suffered from financial stress and a lack of financial confidence with three in four finding the retirement system rules too complex or worrying about their financial future from time to time.
“This is interesting and has implications for portfolio construction and broader advice processes,” Andreissen said.
Just over one-in-two had no medium to long-term financial plans or only had vague ones, with only around one-in-seven having documented plans in place, and almost half of pre-retirees considered themselves to have a low or very low risk tolerance.
“Some of these people are 50 years old and have 40-year time frames. It's no coincidence that they feel cautious because they lack confidence and so that is clearly a conversation point and a way in which an advisor can add value,” Andreissen said.
Ninety-nine per cent were looking forward to progressively reducing working commitments but two-thirds wanted more financial advice support in this transition. Only one-in-20 were receiving it.
“Pre retirees who have an active relationship with a financial planner are twice as likely to have a high-risk tolerance,” Andreissen said.
Recommended for you
It can be extremely hard to realise the gains from financial advice M&A, according to Peloton Partners’ Rob Jones, and more could be gained from firms looking inward at their own practice.
With platforms reporting their quarterly results, there is a clear divide in the adviser markets they are targeting, according to platform specialist Recep Peker, and which would be right for your clients.
The Federal Court has imposed a $10 million penalty on Macquarie Bank for failing to prevent and control unauthorised fee transactions by third parties including financial advisers.
A financial advice firm has seen a weekly decline of 10 advisers, with all moving to a new licensee, while Centrepoint Alliance continues its “growth story”.
