Several recent reports from the Conference Board of Canada regarding retirement planning suggest financial advisors have a big opportunity in front of them.
Not exactly a shocker, its major finding is that Canadians aren’t financially literate.
According to the Conference Board one in five Canadians have never sought financial from anyone including advisors, friends, internet, etc. That’s five million people over the age of 24 just begging to be educated, informed and set on a path to financial salvation.
Possibly even more compelling is the idea that approximately 8.7 million people out of the 20 million or so who’ve actually sought advice have done so without the use of a financial advisor. That’s a huge chunk of the population that is searching for answers outside the financial advisor community. It’s this statistic that portends a move to robo-advisers and other automated advisory services.
But that’s only if financial advisors fail to capitalize on this glaring opportunity.
Those surveyed readily admit that they don’t understand financial concepts – almost half rated their financial literacy as average – yet when employers provide free educational investment events at work, employees are slow to take them up on these offers. Worse still, the Conference Board says 40% of respondents believe employers could do more in this area. There is a clear disconnect between employee and employer when it comes to who’s responsible in this area.
In the Conference Board’s September report, Boosting Retirement Readiness and the Economy Through Financial Advice, it reported that the use of a financial advisor can boost an individual’s rate of savings and overall retirement readiness, regardless of any performance-related issues from recommended investments.
Add to this the use of common sense budgeting and expense tracking apps
such as those provided by Toronto-based financial advisor Victor Godinho
and you’ve got value-added written all over your practice.