A recent study by the commission found that while almost half of people said they got most of their advice from their bank, that was closely followed by friends and family. Financial advisers came in third. Just 15% of people said they received information from an adviser.
Kneebone said that needed to change. “Just because your neighbour doesn’t have income protection, doesn’t mean you shouldn’t. Just because a workmate is a particular KiwiSaver fund, it doesn’t mean you should be, too.”
The survey found that more than 80% of respondents knew that a financial adviser had to give them a disclosure statement, and three-quarters said it was important to find out how an adviser was paid.
Kneebone said he was hoping that moves to increase the numbers of AFAs would pay off, particularly to develop KiwiSaver advice to people as their investments grew.
“It’s an issue for that industry that we have fewer than 2000 AFAs. My preference wold be to see a growing pool.”
Kneebone said New Zealanders needed to broaden their sources of financial information and advisers could play an important part in making sure they turned their knowledge into action.
“The challenge is not the knowledge that we’ve got, we know a lot about money but we don’t necessarily act rationally.”
Only a quarter of people have long-term financial goals. “People get it, but doing it is another thing. For a financial adviser, that direct contact is important. One of their roles is to encourage people to walk the talk. You can get all the information you need from a variety of sources … but advisers have a really important role in helping people make the right decisions.”
Kneebone said he was surprised at some of the coaching conversations he heard financial advisers get into. “They come across customers who know the steps they need to take but need a coach to push them along.”
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