Data and Research

Investors Don’t Trust Advisers Easily

Younger cohorts are far more likely than their older peers to express hesitation and cynicism about the choices their advisers make on their behalf and are more likely to “wish for advice they can trust,” according to a new survey from Scottrade. 

By John Manganaro | March 29, 2017
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Scottrade’s 2017 Retirement Study suggests a “majority of U.S. investors are working with an adviser for retirement planning.”

The study further suggests nearly two-thirds (62%) of investors “are working with a financial professional to help them plan for retirement, and nearly half (47%) of these investors say they are very satisfied with the way their financial adviser has managed their retirement assets.”

Another 43% are “somewhat” satisfied, Scottrade reports.

These numbers will probably seem high to many readers of PLANSPONSOR, who will know that advisers still only directly serve a minority of the total number of U.S. individual investors. It is important to note that the sample was comprised of 1,030 adults in the U.S. aged 18 and older who are already “involved in investment decisions for their household and have $2,500 or more in investments with a full-service brokerage company, online brokerage company or independent financial adviser.”

So really the report is showing that, among those already engaged with their finances and financial services professionals, retirement planning remains a hot topic—and one that causes considerable anxiety.

The survey report shows about half of those polled, “especially Millennials and Gen Xers,” admit they are “overwhelmed by all the investment choices that are available.” At the same time, according to the firm, a majority (61%) “wish they had access to reliable guidance.”

Interestingly, investors who are currently using an adviser are even more likely than those who are not using an adviser to say they “feel overwhelmed by all of the retirement investment choices that are available,” at 52% compared with 42%. For the latter group, it is most likely a lack of awareness rather than real financial prowess that is leading to the outsized confidence.

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