Clients Want Honesty and Value From Advisers But Less Want Advice

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Future financial advice clients are looking for honesty and value, but fewer are likely to seek professional help, according to data just released by CoreData.

The researcher’s 2012 Financial Planning Shadow Shop has revealed that the number one expectation potential clients have of advisers is honesty and transparency (72.5%), closely followed by value for money (51.8%). Consumers also said that they were most likely to commit to an advice relationship if the adviser demonstrated value, ahead of their ability to enthuse or to influence.

However, despite industry and Government efforts to increase the number of Australians seeking professional financial advice, CoreData said its research indicated a decline in intention among potential advice clients to take up financial planning services.

According to CoreData, the measure used to determine how likely a customer was to proceed with an advice relationship after the initial meeting weakened from 2011 to 2012. This was attributed to ongoing economic and market uncertainty weighing on consumers’ spending decisions.

Head of Advice, Wealth and Super at CoreData, Kristen Turnbull, said: “The findings suggest it is really important that planners are able to demonstrate the quantifiable or tangible benefits of seeking advice, given the cost to would-be clients. Often it is the intangible benefits – such as peace of mind and certainty – that are most valued by those clients who have a dedicated financial planner, however in the current environment prospects are heavily focused on how much the service costs and what they get in return.”

The CoreData Financial Planning Shadow Shop Report details financial planners’ ability to engage real buyers of investment, superannuation and insurance advice, as well as deliver services within the framework set out by all relevant legislation. It is measured using seven benchmark categories: assurances, compliance, quality, understanding, intention, reaction and environment.