Vanguard's survey reveals a growing trend of younger investors managing assets through online platforms
A recent Vanguard Canada ‘Value of Advice’ survey shows that Canadian financial advisors maintain high levels of client satisfaction and loyalty, though younger investors are increasingly managing their assets through online brokerages.
The survey indicates that 44 percent of Canadian investors feel their advisor provides high value, and 74 percent believe their advisor is worth the fees they pay. Additionally, 71 percent plan to stay with their current advisor, rising to 80 percent for those aged 55 and older.
However, the survey highlights shifting trust levels among younger investors. Among those aged 18-34, 40 percent use online platforms to manage their investments, while only 38 percent rely on financial advisors.
In contrast, 70 percent of those over 55 depend on advisors, with only 17 percent opting for online platforms.
“It's clear that Canadian investors highly value financial advisors and the guidance they provide. However, there is a tale of two investors split by age in terms of the duration, method, and frequency of financial advice they receive,” said Mario Cianfarani, head of Sales and Distribution, Vanguard Investments Canada Inc.
Cianfarani noted this shift presents both a challenge and opportunity for advisors to offer more holistic wealth management to younger investors.
Although younger investors are more inclined to digital investing, 35 percent of this group reports not fully trusting their financial advisor. Additionally, 47 percent say they lack the time, 39 percent the knowledge, and 42 percent the confidence to manage investments themselves.
Despite these trends, financial advisors remain the primary source of advice for most Canadians, with 89 percent turning to their advisor or bank for financial information.
Human advisors are also viewed as delivering better returns, with 44 percent believing they generate higher returns, compared to only 9 percent who hold that view about robo-advisors.
Frequent communication between advisors and clients has a marked impact on satisfaction and optimism. Forty-six percent of those who communicate monthly or more feel optimistic about their financial future, compared to 18 percent who communicate once a year.
Moreover, 40 percent of those with a financial plan from an advisor report optimism about their financial future, versus 22 percent without a plan.
“As the investment landscape evolves, financial advisors will need to focus on building trust, maintaining regular communication, and emphasizing the value they provide in an increasingly digital world,” Cianfarani added.
