Low confidence and knowledge holds most aspiring investors back

IIROC poll results shed light on obstacles faced by Canadians who want to invest

Low confidence and knowledge holds most aspiring investors back

Most Canadians with no investment experience appear to be stuck in a vicious cycle, as their lack of knowledge and confidence in investing is holding them back from taking the first step.

That’s according to a new survey of 2,000 Canadians, which include 500 aspiring investors, conducted by the Investment Industry Regulatory Organization of Canada (IIROC) with the Strategic Counsel.

Among aspiring investors who participated, 70% were found to have a post-secondary education. Almost half were in the active workforce, while nearly 70% were over 40 years old and another 30% are retired.

Across all aspiring investors who participated, almost half (49%) said they don’t invest because they don’t know enough about it. One quarter (25%) said they preferred to use their money in other ways, and nearly the same number (26%) cited a feeling that investing is too risky.

Six in ten said they weren’t confident in their ability to make good investment decisions (60%) or did not know the options they had in order to get investment information and advice (61%). Meanwhile, almost two thirds (65%) said they do not know what investment products and services were available to them.

The survey also found that aspiring investors — and, to a lesser extent, current investors — held a perceived financial inability to pay for advice from an investment advisor. That included people who don’t feel they have enough money to get advice from an investment advisor (41% of aspiring investors and 23% of current investors) and those who don’t think they can afford to get advice from an investment advisor (28% of aspiring investors and 18% of current investors).

The survey also looked at confidence and knowledge levels among current investors across a number of dimensions. Most current investors were confident in their ability to make decisions about what to do with their money (80%) and about investments (72%). Most were also confident in terms of their understanding of the performance of their current investments (77%) and the fees they currently pay (72%).

Just over two thirds of current investors also considered themselves knowledgeable on the options available for them to get investing information and advice (67%) as well as the financial products and services that are available to them (67%).


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