Product sales from bank-aligned planners in decline
The number of people obtaining wealth management products from bank-aligned planners has been decreasing, according to new research released by Roy Morgan Research.
The finding, contained within the company's Superannuation and Wealth Management in Australia research, was published alongside other data which confirmed that those using financial advisers were likely to be both older and wealthier, and that the family home continued to sit at the centre of peoples' wealth.
However dealing with people's choices with respect to investment vehicles outside of superannuation, the research found that the channels that Australians used to obtain their managed funds had remained largely unchanged over the past five years.
"Those with managed funds (excluding super) have continued to rely on financial planners (either aligned or independent) and accountants, while the proportion of those who obtained their managed fund directly from an institution has increased from 12.1 per cent in December 2010 to 17.5 per cent in June 2013," the research analysis said.
However it said there had been a decrease in those obtaining wealth management products from financial planners tied to a financial institution from 35.2 per cent of products in the three months to March 2008 to 27.7 per cent in the three months to June, this year.
The research also confirmed that most Australians relied on employer-based superannuation, with the data analysis suggesting that "Australians continue to rely on their employers when setting up a superannuation product, which suggests a lack of involvement among most people".
It claimed this might be of concern in circumstances where the proportion of those who had established a fund through a financial planner or adviser had actually decreased over the past five years.
The research showed that those who used a financial planner (either aligned or independent) or an accountant to obtain their wealth management product were more likely to be in the top two quintiles than those who relied on another source, such as an employer or through an institution directly.
"The top two quintiles account for 74.1 per cent of the products obtained from planners/accountants," the analysis said. "This suggests that there exists a need in the market for financial planning for the lower quintiles, for people who are in the wealth accumulation stage. However, as these consumers have a lower income and fewer funds under management, cost and how to pay for the advice would be a bigger consideration for this group compared to the more affluent."
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