What value of advice?
Financial advisers are failing to communicate the value of superannuation advice for medium sized businesses (MSBs), with studies conducted by a market research group finding that a significant proportion of businesses don’t see the value of getting a financial adviser.
Conducted by market research firm Cameron Research Group, the 2007 Superannuation Survey looked at 400 MSBs and found 37 per cent have an independent superannuation adviser, 19 per cent have an adviser that is an employee of their default fund and the remaining 44 per cent do not have any adviser.
According to Cameron Research head Ross Cameron, even though a significant proportion of those employers that did have an adviser saw great value in having one, those without an adviser had no plans on getting one and saw little value in it.
“An overwhelming 84 per cent of those MSBs with an adviser responded that they were either very satisfied or moderately satisfied. The question is, why do so many employers without an adviser believe there is no value in financial advice? These numbers show an obvious disconnect, because employers that do have one say it is of immense value,” Ross said.
“However, I must point out that there was a percentage of employers who said that they get absolutely nothing from their super advisers.”
Cameron said that it became evident after discussions with those surveyed that the reason for this was that they believed the adviser would be solely for the benefit of employees and not theirs.
Advisers are integral when it comes to “educating staff on superannuation, or administrative issues, or if the employer wants information on the performance of the fund. All that comes from the adviser”.
Cameron believes that “advisers have done a poor job communicating to businesses the fact that they are there for the business, more so than for employees”.
“What is astounding is that many of these employers have not even been approached at all. We found that of those employers that didn’t have an adviser, 70 per cent have never been approached by one,” Cameron said.
“The other problem is that this is an unbelievably complicated area, with great confusion over the role that financial advisers play.
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