Nearly three-quarters of consumers have rated the advice they have received from brokers as ‘good’ (or higher), new research from MLC has revealed.
According to the MLC Quarterly Australian Wealth Behaviour Survey, majority of people had not received any financial advice over the past two years, but that those who received advice rated the experience favourably.
The survey found that of the 2,000 respondents asked about their current financial situation and homes (among other topics), 72 to 73 per cent of people had not received any advice about savings, investments and super, while 90 per cent had not received any funding about their children’s education.
Those who received advice said it was mostly in regards to savings, investments, superannuation, retirement and tax planning.
Of those that had used a broker, 71 per cent of these people said that the advice they received was either ‘good’, ‘very good’ or ‘excellent’.
The report revealed that 31 per cent of people said the advice they received from brokers was ‘good’, while 26 per cent said it was ‘very good’, and 14 per cent said it was ‘excellent’. Just 29 per cent of people thought the advice they received from a broker was ‘fair’, ‘poor’, or ‘didn’t know’ what they thought of the advice.
People were most likely to seek financial advice from a broker when it came to investments or insurances, however less than five per cent of people also used a broker to advise on children’s education, tax planning, superannuation and retirement planning (around three per cent each).
Other advisers that received positive ratings were accountants (90 per cent), financial planners (82 per cent), family and friends (82 per cent) and financial institutions (78 per cent), among others.
In terms of home ownership, the survey found that most respondents owned their home with a mortgage (39 per cent), while 32 per cent paid rent to someone else. Just 19 per cent of people surveyed said that they owned their home “outright”.
Looking at demographics, the survey found that those over 50s were most likely to own their home outright (43 per cent of that age group), while most young people (18 to 29) were in rented accommodation (46 per cent of that age group).
Respondents with children were more likely to have a mortgage than their childless counterparts (52 per cent compared to 30 per cent).
The average Australian homeowner was found to have around $475,000 of equity in the family home, with those living in NSW and Victoria having the most.
The survey also found that more than half of respondents thought they would have enough saved at retirement, so they would not have to sell their family home, while nearly a quarter (23 per cent) said that they would like to give the home to their children. Sixteen per cent of people said they were “too attached” to their home to sell it.
“What we tend to see is that people are busy and are overwhelmed by all the financial decisions they have to make – ‘Do I invest and where? How do I prepare for retirement? Can I afford a private school for my kids?’ In the end, they often don’t end up doing much at all, or doing what’s easiest, which may not be the best course of action,” NAB executive general manager of wealth advice, Greg Miller, said.
“It’s natural that having a professional do the legwork and guiding you through such an important part of life takes a lot of the stress away,” he noted.