Kiwis who seek out and receive professional financial advice exhibit good financial behaviours more often than their unadvised counterparts, according to a report by Financial Advice New Zealand.
The report, titled Better Behaviours – Research on the Value of Financial Advice, found that advised Kiwis are more prepared for retirement, feel better about their financial position and more comfortable making big financial decisions, regardless of income level.
This latest report builds on a report from 2020, which showed that financial advice and advisers are trusted and highly valued. It found that many advised New Zealanders say the advice has led to positive outcomes, such as better understanding of the risks of their financial plan (77%), better understanding of how to achieve financial goals (74%) and being better equipped to stick to their financial plans (70%).
More than nine in 10 (91%) of advised consumers agreed that the service provided by their adviser met their needs. Advised consumers are also more confident in making big financial decisions, with 94% saying they are very or reasonably confident, compared to 83% of the unadvised.
Uptake of insurance is higher among advised Kiwis. Almost twice as many advised Kiwis have life insurance (59% compared to 32%) and health insurance (55% compared to 28%) than unadvised. The difference is wider for other types of insurance, such as income protection and total and permanent disability insurance at slightly over three times.
Advised Kiwis plan for and expect a better retirement, as they feel they have a better understanding of how much money they will need in retirement (62% vs 40% across all age groups).
“The Better Behaviours results clearly illustrate that advised Kiwis are more likely to have a documented budget and financial plan, to review their financial products regularly, to understand risk vs return, and to take-up and cancel insurance products when appropriate,” Financial Advice NZ said. “They are also more likely to have positive mortgage behaviours, setting themselves up to save interest and carve years off the life of their mortgages. Across the board (mortgage advice, investment advice, insurance advice and financial planning), quality financial advice has given Kiwis the tools to think about their finances in a pro-active way, given them more financial confidence and control, and has had a significant effect on their sense of financial wellbeing.”
