An adviser, an accountant, or Google? Where Australians are getting their financial advice

Recent research highlights plenty of demand for financial advice…but also some roadblocks to deliver¹.

So where do Australians go when they need advice on their finances? An adviser? An accountant? A bank manager?

Actually, none of the above. The research reveals the tried and trusted Google search comes out equal top with super funds (26%) as the most used source of information - news that many in the industry will greet with a wry smile.

But the report also highlights there’s plenty of demand out there for professional financial advice, delivered by experts.
 

When we were very young…

It’s clear that attitudes towards financial advice vary, particularly as Australians progress through their working lives. When people are starting out in their careers there are obvious challenges with persuading them about the benefits of advice - but also opportunities.

Significantly more working Australians aged 18-29 haven’t sought financial advice as they don’t know where to start or feel it’s all a bit too complicated (28%).

But the appetite for advice is there on the things that matter – whether it’s big life goals or daily money challenges.

• One of the main reasons for younger Australians to seek advice is purchasing a home (31%) 
• And they’re also more likely to seek advice on managing debt (29%).

So when they do need advice where do they tend to go? Well, almost one in five (17%) have sought financial advice from bank managers over the past 12 months. And younger Australians tend to chat to co-workers about finances (18%) more than older age groups (9%).

…now we are 60

It will come as little surprise that as we get older, we’re more likely to seek advice on retirement - 74% of 60+ year-olds have done so, compared with 62% of 50-59 year-olds and only 13% of 18-29 year-olds.

And pre-retirees do seem more amenable to asking an expert – those over 60 are less trusting of non-professional advice, including co-workers (37% don’t trust), Google search (36%) and advice from family and friends (20%).

But there’s still a significant cohort of older working Australians who are resistant to advice – one in three 50+ year-olds are extremely unlikely to seek financial advice (31%) – suggesting they feel either very confident in their knowledge, or very comfortable with their current situation.
 

Walking the walk

Overall, the good news is that almost one in two workers say they’re likely to seek professional financial advice over the next 12 months (47%).

However, the reality is only 19% are truly likely to seek financial advice. Why? It’s all about the intention-action gap – the difference between what people plan to do and what they actually do.
 

What’s putting people off going to an adviser?

Experts are generally rated as pretty trustworthy – accountants (66%), super fund (65%), and financial advisers and bank managers (58%) – aren’t too far behind the ATO website (66%), and family and friends (64%) as sources of advice

But while advisers might be highly trusted, they don’t feature in the top five most valued sources of information.

So what’s the main barrier to seeking advice? It probably won’t come as too much of a shock to find out it’s cost – or at least, the perception of cost.

While money is the leading trigger for using professional financial advice – cited by 26% of working Australians – it’s also a major hurdle.

Top 5 barriers to seeking professional financial advice

1. It costs too much (41%)
2. My finances are too simple (31%)
3. I prefer to make decisions myself (29%)
4. I’m able to make decisions without advice (18%)
5. I don’t trust others 15%

How retirees see advice

So what about when we retire? Looking at financial assistance in the broader sense, retirees are actually less likely to seek out help from others.

More than half (56%) of retirees have not sought any advice from others in past 12 months, compared with 26% of working Australians. And 53% of retirees don’t plan to do so in the next 12 months, compared with 17% of employees.

So why is this? It’s a combination of a lack of trust and overconfidence. A quarter (25%) of retirees say they don’t trust others to look after their finances, while they are particularly confident in areas such as wills (41%), banking accounts (35%) and budgeting/saving (34%) – perhaps due to years of practice!

But there is untapped opportunity for advice, with retirees valuing the benefits of old-fashioned in-person service. They are significantly less trusting of robo advice (47% don’t trust), stockbrokers (46%) and financial journals/newspapers (44%). And 48% see advisers as a trusted source of information.

Clearly planning their retirement is an important consideration but it’s actually not the only thing on retirees’ minds. They are actually looking for help with the basic nuts and bolts of their personal finances.
 

Top 3 reasons why retirees go to an adviser

1. Help with general financial management (50%)
2. Help plan retirement (47%)
3. Help manage investments (41%)

Opportunity knocks

Although there’s clearly interest in professional financial advice, advisers need to prove their value to switch people from considerers to users.
 

¹  AMP 2022 Financial Wellness Research Report

Like to know more?

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