When advice doesn’t come from a planner

New research has revealed that as many as six million Australians seek advice about money and investments from friends and families and particularly from people who they regard as “trusted advisers”.

The research, conducted by Roy Morgan, found that these “trusted advisers” were more likely to have greater involve and experience in finance and to be earning higher salaries.

The research listed the groups with a higher than average incidence of ‘trusted advisors’ status as including people with personal incomes of $120,000 over (32.3 per cent); professionals/managers/small business owners (29.6 per cent); and those with a degree (23.4 per cent).

“All of the groups that are more likely to be asked for financial advice appear to have greater involvement and experience in finance and as a result others are more likely to trust in their opinion,” the research said.

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Commenting on the research, Roy Morgan Industry Communications director, Norman Morris said it showed that financial decisions for many people had the potential to be impacted to a considerable extent by informal advice from friends and family, rather than relying on professional financial planners.

“With three and a half million people being asked by family and friends for financial advice and six million asking them for advice, this network is likely to play a major role in financial decisions,” he said.

Morris also suggested that the banks used by the people who give advice had the potential to gain customers provided they had high satisfaction and as a result were more likely to be advocates for their bank.

“It is therefore worth banks understanding and tracking that important group of their customers,” he said.