New data from intelliflo finds younger generations feel insecure over seeking financial advice, just as more report having little to no savings for retirement.
In conjunction with the Harris Poll, the technology platform surveyed over 2,000 U.S. adults around their need for professional advice and progress towards retirement savings, finding that 74% of Americans say there are financial topics they would like professional advice on.
Gen Zers and Millennials were especially likely to indicate a need for better financial advice, as 82% of Gen Zers and 84% of Millennials said there are financial topics they would like guidance on.
Despite the need, 76% of the youngest working cohort and 71% of Millennials have not sought out advice, adding that they aren’t sure where to find an advisor who suits them (38% of Gen Z vs. 27% of Millennials) or they don’t have enough money to hire one (33% Gen Z vs. 31% Millennials).
“Our recent survey highlights the disconnect between needing and obtaining professional financial advice, which is especially prevalent in younger generations,” said Lisa Jacobs, vice president of client services at intelliflo redblack, in a statement. “As these generations acquire and inherit wealth, they will need wider, easier access to financial advice, and they want it via digitally optimized tools. Advisors who do not evolve risk losing these important and profitable segments to alternative providers and disruptors.”
The lack of financial planning and advice could serve as reason to why 40% of Gen Z respondents reported having zero savings for retirement. Meanwhile, just over half of Americans (53%) have saved under $100,000 for retirement, and 25% have saved nothing at all, reported intelliflo.
“Equally troubling is the lack of investment for retirement among younger Americans,” added Jacobs. “While many will start to save as they get older, financial advice while young can make a tangible difference later in life.”
Intelliflo’s findings come as recent reports underscore a shift away from human advice, now to digital planning tools that include robo-advisors and ChatGPT. An April study from J.D. Power found 86% of Gen Z and 79% of Millennial investors reported interested in receiving robo-advice, and a later survey from Nationwide saw a third of investors opt for financial advice from ChatGPT over a human advisor.
Still, the value of a human advisor still holds weight, said Kristi Martin Rodriguez, a leader of the Nationwide Retirement Institute, in a statement at the time to 401(k) Specialist. “The opportunity for the advisor is to focus on building a human/emotional connection with investors – particularly when they are feeling scared about their financial security,” Rodriguez emphasized. “Good advisors know how to listen to clients and help them remain calm and confident about their financial plan.”
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Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with over six years of experience and a passion for telling stories and reporting news. Amanda received her degree in journalism and government and politics at St. John’s University. She is originally from Queens, New York, but now resides in Denver, Colorado with her partner. In her free time, Amanda enjoys running, cooking, and watching the latest drama show.
