As the coronavirus drives economic uncertainty, one quarter of investors are looking to financial advisors for help for the first time, according to a Nationwide survey released Thursday.
Twenty-six percent of investors with at least $100,000 in investable assets, as well as 24% of all respondents who participated in the survey, said they are seeking help by engaging a financial advisor for the first time as a result of the pandemic. The Nationwide Retirement Institute survey included 2,042 adults in the United States, including a subset of 603 investors with at least $100,000 in investable assets.
"Right now, Americans feel a lack of control and a need for more guidance," said Kristi Rodriguez, leader of the Nationwide Retirement Institute. "Even if they do all the right things to manage their finances and investments, the vast majority of Americans agreed they can still be blindsided by outside events. According to 49% of respondents and 52% of investors, the Covid-19 pandemic made them realize that they need help managing their finances and investments to succeed in the future."
The survey also showed that 59% of the participants fear contracting Covid-19 more than they fear a U.S. economic recession.
Most respondents said they are concerned to some degree about their finances because of the coronavirus. Thirty-eight percent said they are cautious, 32% said they are uncertain, and 7% said they feel hopeless. A smaller group, 18%, said they are optimistic.
Advisors top the list of trusted sources for general financial and money management advice during the pandemic, the survey showed. Among all the participants, the top choices named as trusted sources, in order, were financial advisors (37%), respondents’ friends and family (29%), online investment management and financial planning tools (20%) and the respondents’ employer-sponsored retirement plans (20%). Of the investor subset, 55% said financial advisors were their top trusted sources.
While 24% of respondents and 31% of investors said they do not expect the pandemic to affect their ability to meet their financial obligations, the majority of Americans are now feeling pressure, Nationwide said. Among all the respondents, the top three financial concerns related to the pandemic were being unable to pay their bills or meet their financial obligations (named by 45%), losing their life's savings (named by 33%) and losing their jobs (cited by 30%).
About half of the participants said the pandemic has made them more aware of a need for annuities, life insurance and long-term-care insurance.
While the pandemic impacts immediate financial needs and the ability to care for family and loved ones, 42% of respondents said they are staying the course with their long-term investments.