Cerulli: Investors under age 40 lack financial advice
By National Underwriter
By Warren S. Hersch
Fewer than one in five investors under age 40 believe they received adequate financial advice following a recent life event, according to a new report.
Cerulli Associates, Boston, published this finding in the second quarter 2013 report of the “The Cerulli Edge: Retirement Edition.” The report examines the characteristics of investors under age 40.
The percentage of households agreeing they are getting enough financial advice following the start of a new job tops out 19 percent in the report, less than one five of those surveyed by Cerulli. The fewest households—just one percent—said they received adequate advice following a divorce.
The percentage of households indicating they received enough advice for other life events was in the single-digits to low double-digits. Among them:
- 12 percent—moved primary residence
- 11 percent—New child born into the home
- 9 percent—Left a job (but not to retire)
- 8 percent—got married
- 7 percent—lost a job
- 6 percent—bought a new home
- 4 percent—refinanced my mortgage
- 4 percent—Changed careers
- 1 percent—received an inheritance
The report urges asset managers and record-keepers to “use the advice gap as a market opportunity” by engaging with clients under age 40 prior to big life events.
According to record-keepers, Cerulli states, simplification and automation are the best plan design changes that plan sponsors can make to encourage savings among investors under 40. More than 9 in 10 (92 percent) urge simplification of the enrollment process. Other plan design change they point to include: