Color us not at all surprised; Americans with a financial advisor feel better and do better with spending and saving, both before and in retirement.
Nearly seven in 10 Americans who use a financial advisor believe “they have clarity on how much to spend now and save for later compared to less than half of those without an advisor,” according to a new study from Northwestern Mutual.
Individuals without an advisor are more than twice as likely as people with an advisor to say they are “not at all confident” they have the balance between spending and saving correct.
This may be one reason why those without an advisor are more likely than those with an advisor (60 percent vs. 37percent) to point to debt reduction as a top priority.
“Financial decision-making can be overwhelming, especially when juggling a number of competing priorities,” Sandy Botcher, vice president of distribution with Northwestern Mutual, said in a statement. “A financial advisor has the expertise and objectivity to see the whole picture and develop a strategy that’s flexible enough to enjoy life today while securing tomorrow.”
Study results also showed Americans who work with financial advisors demonstrate higher levels of retirement readiness, disciplined planning, and financial confidence.
Specifically:
- More than half of those with an advisor feel very financially secure. Only a fraction of people without an advisor said the same;
- Three-quarters of Americans with advisors consider themselves “disciplined” or “highly disciplined” financial planners relative to just 37 percent of those without an advisor;
- More than 7 in 10 people with an advisor said their plan has been created to endure market cycles—compared to less than a third of those without an advisor;
- Most Americans with an advisor believe that, if they work past traditional retirement age, it will be by choice rather than from necessity. Notably, the inverse is true for those without an advisor, with 6 in 10 expecting to remain employed past retirement age from necessity.
While the findings underscore the overall value of working with an advisor, Americans cited several attributes that distinguish a remarkable advisor experience from just an acceptable one.
“Someone I can fully trust to have my best interests at heart/not just out to sell product” emerged as the leading priority.
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
