While financial advice offers clear benefits, many Kiwis are not taking advantage of it.
This is the perspective of the Financial Services Council (FSC), who recently released the final part of its three-part “Money & You” series.
Previous research in this series demonstrated the positive impact of financial guidance, addressing the connection between money and wellbeing and how money worries can cause significant stress. Part 2 revealed that those seeking financial advice earn an additional 4 percent per year, enjoy more disposable income, and have over 50 percent more in their KiwiSaver accounts. Part 3 showed further benefits, indicating that advised individuals are 15 percent more likely to withstand an income shock for over a month, and they report higher financial stability, literacy, and wellbeing.
Despite the clear benefits of financial advice, few Kiwis actually seek it. The FSC findings reveal that only 18 percent of New Zealanders receive financial advice, while just 35 percent would consider getting it.
These findings also highlight the primary reasons New Zealanders forgo financial guidance. Firstly, 65.2 percent of unadvised Kiwis believe they aren’t wealthy enough to require financial advice. Secondly, 62.5 percent feel that obtaining such advice would be too costly.
Despite this, Clive Fernandes, director of National Capital, remains optimistic about New Zealanders’ future access to financial advice. He believes that “new legislation and technology will provide Kiwis with greater access to guidance.”
“Money and You” series reveals that major life events often drive individuals to seek financial guidance. For instance, 23.8 percent of those surveyed sought financial advice when buying a property. Other reasons for seeking help included recommendations from family, friends, or colleagues (19.6 percent), having excess income after paying off debt (15.0 percent), and approaching retirement (14.3 percent).
National Capital is a research-led, independent KiwiSaver advice provider that is paid KiwiSaver Providers. Contact us if you need our help in getting on track for your KiwiSaver financial goals.
Published on: