Investors are looking for help wherever they can find it – whether that is digital or human professionals, according to two surveys released Thursday by Hearts & Wallets, an information source for retail investor data.
Seventy-one percent of consumers use some type of financial advice, an increase of 5 percentage points since last year. At the same time, 42 percent of the 5,000 people surveyed use a paid financial professional, up from 40 percent in 2012, according to Hearts & Wallets. The increases may be due to the fact that half of those surveyed say they are challenged by investment selection.
The results are part of the Hearts & Wallets studies “Advice and Technology” and “Pain Points and Action.”
“After weathering financial storms, Americans are signaling a readiness to act,” says Laura Varas, Hearts & Wallets founder and CEO. “Financial services providers have a bigger-than-ever opportunity to engage consumers by better understanding how they blend advice inputs, both digital and human, to answer their most pressing pain points. This is especially critical when shaping Next-Gen strategies, given that many younger investors haven’t yet bonded with providers.”
The use of financial technology increased by 7 percentage points year over year and grew from 34 percent in 2011 to 50 percent. Twenty percent of users consult digital financial sources weekly, with those between ages 21 and 39 and those with at least $2 million in investable assets being more likely to be frequent users.
Younger investors can be elusive customers for financial service providers given their mobility, says Hearts and Wallets. In the last three years, half of younger Americans have changed jobs.
“Younger investors are searching for their baby steps now to get comfortable with savings and investing,” Varas says. “They are consulting a wide range of advice sources and looking for help to choose appropriate investments.”