First the good news, almost nine out of ten Americans (88%) say that working with a financial advisor would help them reach their financial goals including planning for a comfortable retirement.
The bad news? The reality is that just 44% are doing so according to an annual retirement study by Allianz Life Insurance Co. of North America – and the percentage is down from 48% in 2022.
The challenge for advisors is how to convert aspiration into action and onboard those who want advice on matters such as how to take distributions from retirement savings for their retirement income (78%), and not having enough money to do all the things they want to do in retirement (75%).
The core working age cohort of millennials has seen the steepest drop in use of financial professionals, from 46% in 2022 to 36% in 2023, which is curious given that this group is also most likely to see the value in working with an advisor to ensure their finances support their life goals.
Respondents across generations said that they may not discuss certain topics - including longevity and health care costs - with an advisor if they feel they might try to sell them something (14%), because they did not know their advisor could help them with it (15%), or because they haven’t prioritized finding a solution (23%). Almost one fifth would wait for the professional to raise the topic and a similar share does not meet regularly with an advisor to discuss such matters.
Across all generations, the survey found that a holistic approach to financial advice is required and, crucially, collaboration cannot mean giving up control with 57% of respondents wanting advisors to offer suggestions that the client ultimately decides on. A quarter said that the relationship should feel like a partnership.
“In the past, playing to your strengths in terms of product selection may have been a winning strategy, but financial professionals need to be clear that they are open to collaboration and solutions outside of what they usually offer,” said Kelly LaVigne, vice president of consumer insights at Allianz Life. “It’s about meeting clients where they are, mentally and emotionally, and finding out what keeps them up at night.”
Other key words used in responses include understanding (of values/beliefs and personal concerns) and empathy (towards financial situation and struggles).
“Consumers’ desire for financial advice is as strong as it’s ever been, but financial professionals need to think more broadly about their role," LaVigne concluded. “To successfully serve the next generation of clients, financial professionals need to focus on collaboration, flexibility and truly understanding their clients’ values, priorities and concerns.”
Canadian stocks are on a roll in 2025 as the country prepares to name a new Prime Minister.
Two C-level leaders reveal the new time-saving tools they've implemented and what advisors are doing with their newly freed-up hours.
The RIA led by Merrill Lynch veteran John Thiel is helping its advisors take part in the growing trend toward fee-based annuities.
Driven by robust transaction activity amid market turbulence and increased focus on billion-dollar plus targets, Echelon Partners expects another all-time high in 2025.
The looming threat of federal funding cuts to state and local governments has lawmakers weighing a levy that was phased out in 1981.
RIAs face rising regulatory pressure in 2025. Forward-looking firms are responding with embedded technology, not more paperwork.
As inheritances are set to reshape client portfolios and next-gen heirs demand digital-first experiences, firms are retooling their wealth tech stacks and succession models in real time.
