As we all wait with baited breath for the induction of our 45th President, it is often the case that perception is reality. On the one hand, financial advisors are interested in working with more clients. On the other, “Americans think advisors don’t want them,” says Christopher Robbins on September 29, 2016 at Financial Advisor.
TIAA took an “Advice Matters Survey” of 1,000 American adults from August 10 to August 15, 2016 where 49 percent believe they need no less than $50,000 in liquid assets to qualify meeting with a financial advisor. This is up from the 2015 survey when 45 percent of those queried felt they needed at least $50,000 in savings to work with a professional. TIAA found that 71 percent were interested in receiving advice, but only 48 percent had worked with a financial advisor. Robbins wrote, “The gap between interest in advice and action widened with respondents’ age and income. TIAA says that only around 45 percent of millennial respondents, aged 18 to 35, have received advice even though 82 percent expressed interest in meeting with an advisor. Similarly, 30 percent of survey participants with annual incomes less than $50,000 have received advice, but 61 percent of that group expressed interest in it.” He went on to say, “Of the respondents who have already met with an advisor, 77 percent say they wish they had received advice sooner.”
It is interesting to note how the opinion changes based on age. Of the respondents, 59 percent believe that the best age to start working with an advisor is 35, but when it comes to millennials the number jumps to 80 percent.
When it comes to gender, 40 percent of women respondents had received financial advice, as compared to 56 percent of men.
Almost 75 percent said they would be most interested in a job with a benefit package that included complimentary financial advice. Among Millennial respondents the percentage soars to 87 percent.
Fee transparency ranked the highest on the TIAA list of things that motivated investors to hire an advisor. Of those surveyed 29 percent reported they would be more likely to work with an advisor once they had a complete appreciation for any and all fees. 24 percent wanted a referral from family or friends, 22 percent said it was important for the professional to be qualified to help, and 20 percent submitted that they did not want the advisor to become a salesperson trying to sell them “particular products, services or investments,” writes the author.
Allow me to apologize for my industry. According to me, part of the problem here is one of language. I’m not just talking about jargon, as that is a huge problem my peers and I have. We have a hard time speaking in plain English where investors with the math skills that we have as they are can begin to see that achieving financial independence is indeed a possibility. The titles we choose to use add to or even compound the problem. When we call ourselves a ‘wealth manager’ it certainly sounds arrogant to me. What’s more, there are those who are well-to-do, but not so many of us are actually wealthy. If you have amassed a liquid net worth of $5 million, for example, and you are applying the 4 percent withdrawal rule, that provides an income of $200,000 per year. If that’s what you are used to spending, you don’t believe you are wealthy and I would agree. In Southern California, it may mean you need $10 million to be wealthy. Applying the same 4 percent withdrawal rule, that works out to an annual income of $400,000. You can decide if that income qualifies as wealthy.
Sheyna Steiner at Bankrate.com asked the question, “Do you think you will be rich one day?” She wrote, “In this land of opportunity, Americans may believe that it’s harder to get rich than it used to be. But when asked about the likelihood of getting rich personally, one-third say it’s very or somewhat likely that they will attain wealth because of their work, investments, inheritance or good luck. On the other hand, 63 percent say it’s not too or not at all likely they’ll get rich. Just 2 percent volunteered that they’re already rich.
How would you define rich?
Source: Sheyna Steiner – Bankrate.com
I understand you want to believe you don’t have enough money to take the first step on your road to financial independence. I get that you want to be left alone. After all, you would like to think you’re too old and your math skills aren’t up to par. I understand. Now, don’t believe everything you think. Just muster up the courage to hire professional help. I am asking you to do two things. First, decide at what age you would like to make work optional? Second, what is your adequate asset base amount needed to make work optional at that time? You know it won’t get any easier. In fact, we all know it will only get more difficult and a lot more expensive. So save money and time. As you breathe and smile start today to plan your financial success. Remember, “77 percent say they wish they had received advice sooner.”
We are on a mission to save your assets.
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