Advisers lower investment threshold - survey

Research commissioned by ING Australia has found that advisers are now more willing to lower their investable assets threshold for new clients.

ING Australia commissioned Nielsen to survey over 700 consumers and more than 250 financial advisers in June and July to better understand consumer perceptions of financial advice, building on research undertaken for ING in 2006 and 2005.

Although the research found that a majority of advisers still consider investable assets of $100,000 or more as appropriate and serviceable, an increasing number will now consider less than $100,000 and even $50,000 adequate to receive financial advice.

Ross Barnwell, ING Australia Executive Director of Sales & Marketing, said that while advisers are still chasing the top end their expectations have moderated.

“Fifty-nine per cent of our surveyed advisers cite that a client needs at least $100,000 of investable assets, but this result is down from last year’s 63 per cent.”

The research also found that investment advice provided by financial advisers was rarely accepted in full.  Only 16 per cent of surveyed clients invested all of their total investments (excluding property) in accordance with their financial adviser’s advice.  This is a slight drop on last year’s 17 per cent result for the same question.

“While the three top reasons to seek financial advice remain the same as in previous years – general advice, managing investments, and retirement planning – this year’s results indicate that satisfaction with this advice has dropped.

“In the 2007 survey 57 per cent of surveyed clients were very satisfied with their financial adviser.  This year the figure is 52 per cent.

“This not a big drop, but is does reflect client concerns due to the changed market dynamics witnessed during 2008.

“These subtle changes in client expectations have an impact on adviser practice and the approach required to retain clients.

“ING commissioned this research for insights into client and adviser behaviour and will use these results to tailor solutions and strategies that will benefit the client-adviser relationship,” said Mr Barnwell.