Experience and qualification are key attributes that people look for in an advisor, shows a study conducted by Principal Retirement Advisors.
A study conducted by Principal Retirement Advisors (India) as a part of its Financial Well-Being Index showed that 64% respondents feel financially more confident after availing services of financial advisor.
Not surprisingly, almost 70% people consult financial advisors referred by their friends, family & co-workers. Experience (47%) and qualification (47%) are key attributes that people look for in an advisor.
Setting financial goals (51%), tax saving/planning (47%) and retirement planning (35%) are the top reasons for consulting a financial advisor.
55% people cite knowledge (‘know enough on their own’) as the foremost reason for not consulting a financial advisor. 51% of those not consulting a financial advisor are willing to pay fees for financial advice in future
Here are some of the key findings of the study:
Perceptions & concerns of economy in general
- 48% of Indian households expect the economy to worsen in 2014. This pessimist view is exhibited more by the older population.
- Fuel prices (79%), food prices (69%), rising inflation (74%) and unemployment (69%) are seen as top concern areas for the economy in the next 1 year
- Overall 77% respondents feel that the prices of groceries, fuel and other household items will go up in next one year. Respondents feel that increase in prices for food & beverages (72%) and transportation (69%) are likely to affect their budgets seriously
- 78% respondents are concerned about rise in home loan interest rates in the next one year
- 57% of overall respondents see rupee falling more vis-a-vis US$ in the next one year
Household spending, savings & investments
- More and more respondents exhibit attitude towards high consumption & spending on new items & luxuries. Most households expect spending to increase across all expense categories
- Buying a house/property (51%) & children’s expenses (education & marriage) are the key big ticket expenses expected in 2014
- 74% households are satisfied with their current levels of savings. 67% households say that their savings have stayed the same in the past 1-2 years
- 69% households are satisfied with their current level of investments
- Holiday plan: 73% people say they are not planning a holiday in 2014. Out of the remaining 27% who are planning a holiday in 2014, 60% will spend the same amount as last year
- Festivity spending: 64% people say they will spend the same amount as last year in the upcoming festivities
- Planning for unexpected expenses/ emergencies: To cope with unexpected expenses, Indians plan to cut down expenses on non-essential items (42%) and use money from savings (38%). This indicates that people have made no specific preparation to cope up with emergencies.
- Financial priorities & attitude towards finances: Overall respondents feel that they are in control of their financial situation (63%) and are making good progress (63%) towards their financial goals.
Retirement planning attitude & perceptions
- Staying happy & stress free (48%) and having enough savings (45%) are the main thoughts for post-retirement finances
- Overall 52% people claim to have started investing for retirement when they were 26 – 30 years old. 76% plan to retire between 56-60 years of age. Buying a house (25%), children education (23%) & children marriage are the top 3 aspirations post retirement
Employee benefits & satisfaction levels
- 75% respondents feel that employee benefits are critical for employee retention/better performance
- Disability Insurance, financial planning, are the top benefits with highest satisfaction levels
The research was conducted in 11 cities among 1664 respondents in Ahmedabad, Bengaluru, Chennai, Chandigarh, Delhi, Hyderabad, Jaipur, Kolkata, Lucknow, Mumbai and Pune. The study was conducted by Nielsen in the last quarter of 2013.
