New study points to the value of advisor services but just how little clients understand of what they do
A Nielson study into investor behaviours and values has found that almost half of people attribute positive investment experiences to good professional advice they’ve received -- and they’re happy to pay for the privilege.
However, the survey, commissioned by AGF Investments, also found that a considerable number of Canadians are unsure about how it all works when it comes to financial advice and planning. This means that perhaps the sector needs to look at how best to advertise the services and educate people on what a planner can do for an individual.
Geoff Greenall, a Vancouver-based financial advisor, said people should also be concerned about who their advisor is rather than only looking into any products they are offered.
“The quality of advice over the long term will not only help keep returns realistic, but more importantly keep clients protected from themselves.”
Many also believed that they needed at least $25,000 in savings to make it worthwhile to see a planner or cited not having met one as reasons for not using a financial advisor.
The aim of the study was to understand how Canadian investors differed in terms of generations, gender and those with a financial advisor versus those without.
Blake C. Goldring, chairman and chief executive officer at AGF Management Limited, said: "We wanted to find out what is top of mind when it comes to investing and what we can do to help Canadian investors reach their investment goals."
The research indicates that having an advisor could help people reach their goals, which is good news for the industry but many still opt to go down the DIY route with almost half of respondents saying they had never worked with an advisor.
Constantine Lycos, president at Lycos Asset Management Inc., says that if people do go it alone, as opposed to using an advisor, it’s important they understand how investment works.
“If they want to go against the odds and pick investments themselves, they should work on understanding investor psychology first before doing anything else because the biggest reasons why investors without an advisor underperform is that they tend to sell after investments go down and buy after they go up.”
About 20% of people did say they would consider using a financial advisor when they have enough money saved up or when they feel like they are no longer successfully investing on their own so perhaps it’s a case of waiting for a while before new clients find their way to the professional services.
However, the survey, commissioned by AGF Investments, also found that a considerable number of Canadians are unsure about how it all works when it comes to financial advice and planning. This means that perhaps the sector needs to look at how best to advertise the services and educate people on what a planner can do for an individual.
Geoff Greenall, a Vancouver-based financial advisor, said people should also be concerned about who their advisor is rather than only looking into any products they are offered.
“The quality of advice over the long term will not only help keep returns realistic, but more importantly keep clients protected from themselves.”
Many also believed that they needed at least $25,000 in savings to make it worthwhile to see a planner or cited not having met one as reasons for not using a financial advisor.
The aim of the study was to understand how Canadian investors differed in terms of generations, gender and those with a financial advisor versus those without.
Blake C. Goldring, chairman and chief executive officer at AGF Management Limited, said: "We wanted to find out what is top of mind when it comes to investing and what we can do to help Canadian investors reach their investment goals."
The research indicates that having an advisor could help people reach their goals, which is good news for the industry but many still opt to go down the DIY route with almost half of respondents saying they had never worked with an advisor.
Constantine Lycos, president at Lycos Asset Management Inc., says that if people do go it alone, as opposed to using an advisor, it’s important they understand how investment works.
“If they want to go against the odds and pick investments themselves, they should work on understanding investor psychology first before doing anything else because the biggest reasons why investors without an advisor underperform is that they tend to sell after investments go down and buy after they go up.”
About 20% of people did say they would consider using a financial advisor when they have enough money saved up or when they feel like they are no longer successfully investing on their own so perhaps it’s a case of waiting for a while before new clients find their way to the professional services.
