Financial Planning
Value but no trust in advice: Report

New research from ASIC reveals what consumers really think when it comes to financial advice.

The independent research, commissioned by the regulator, found that while consumers can see the value in seeking financial advice, lack of trust in the industry remains a key barrier.

About 19% of respondents to the survey said they do not trust financial advisers.

Digging deeper, about 49% of respondents said financial advisers are more interested in making themselves rich than helping customers.

A further 37% said financial advisers do not generally have their customers' best interests at heart.

The research involved focus groups as well as surveying Australians on their views on financial advice.

ASIC reports that one participant in a focus group said of advisers: "I don't trust them. I think they're misleading and deceptive and I think they're expensive... I haven't got a high regard for financial planners."

The research found 41% of Australians reportedly intended to get personal financial advice in the future but many of them end up not following through on that because of barriers.

Only 27% have actually ever received financial advice, and only 12% had in the past year.

ASIC commissioner Danielle Press explained some of the factors holding Australians back from accessing advice.

"While Australians believe financial advisers can offer significant expertise on financial matters, our research shows that many don't seek advice because they are put off by factors such as high costs, significant distrust of the industry and a perception that financial advice is only for the wealthy," Press said.

The most common factor stopping Australians receiving advice was expense (35%) followed by feeling like their financial circumstances don't warrant advice (29%).

The research found those consumers who had received advice had a more positive view of the industry - being four times more likely to say they had "a great deal" of confidence in advisers.

Interestingly, the focus groups revealed those with knowledge of industry reforms like the Future of Financial Advice had better attitudes to advice too.

"So, it is even more important for industry to get on board with the reforms," Press said.

The most common topics for Australians to want advice on were investments (45%) and retirement income planning (37%).

The research focused on the overall use of financial advisers, motivators and barriers to seeking personal advice as well as consumer attitudes towards the advice industry.

Read more: ASICDanielle PressFuture of Financial Advice
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