The ‘Money and You – Literacy, Insight & Advice’ research report commissioned by the Financial Services Council have found that Kiwis' reluctance in seeking financial advice has come with significant financial and personal costs.
So how much more money do Kiwis who get financial advice have, compared to those who don’t?
The Numbers
The survey of 2000 Kiwis found that those who get financial advice tend to save more, invest more, travel more, and have an overall improved well being. On average, financial returns for Kiwis that get professional advice are 4% better than those who don’t. To put it in perspective, if a 25-year old took financial advice and saved $2,500 per year, they would be $1.5 million better off at 55 than if they didn’t take advice (Source: Financial Services Council).
The study also showed that New Zealanders who speak to a financial advisor, on average, have KiwiSaver balances over 50% bigger than those who don’t, and feel more confident when making financial decisions.
The Situation
In the midst of a volatile economic climate where only one in three Kiwis feel financially secure, seeking professional financial advice is more critical than ever. Unfortunately, for many Kiwis, their desired retirement lifestyle cannot be met with their projected retirement savings and the current level of NZ Superannuation.
The research also confirms there are too many Kiwis not taking the steps to get good advice. It was found that 75% don’t recognise the positive impact that financial stability has on their mental wellbeing (Source: Financial Services Council).
When you have sufficient money for your needs, you have one less thing to stress over. Stress has flow-on effects on your mental health – impacting your ability to sleep, and your susceptibility to illnesses and substance abuse. Ultimately, stress can lead to poor performance at work, your social life, and your overall well being. This cycle of money and mental health can be exhausting and getting financial advice can provide a sense of security and help reduce anxiety.
The Solution
We know that getting financial advice is important, but until now, financial advice has not been accessible to all. Getting financial advice has been inaccessible because of the high fees charged by financial advisors and that financial advisors usually work with the wealthy. However, recent changes in technology and legislation have allowed companies to address these perceptions and barriers that are preventing Kiwis from getting financial advice.
As an example, National Capital was started to help everyday Kiwis get access to quality financial advice. To make financial advice more accessible for Kiwis, we operate online and do not charge fees for giving our clients financial advice. We are able to give financial recommendations to you at no cost because we get paid by KiwiSaver providers. We monitor providers’ funds, keep in contact with clients, and alter our recommendations based on evolving circumstances.
Transparency and trust are also important aspects of our organisation and how we operate. We stay 100% transparent with you throughout the process. To join our group of customers who have a personalised KiwiSaver strategy getting them closer to their retirement goals, get started and take our KiwiSaver HealthCheck.
