Financial advisors are key to quelling retirement fears, study shows
Sixty-five percent of Americans with an advisor say they feel financially secure, compared to just 29% without one.
Fears about saving for retirement plague a large portion of U.S. workers, however a new study reveals data on how American employees can quell financial anxiety. The study, shared by Northwestern Mutual, found that 75% of those who work with a financial advisor say they will be financially prepared for retirement versus 45% of people without an advisor.
The study revealed that when it comes to finances, qualified advisors are the most trusted source – twice as trusted as family members and 8x more trusted than “FinTok” social media influencers. Sixty-five percent of Americans with an advisor say they feel financially secure, compared to just 29% without one.
According to the study, financial advisors don’t only help to quell fears about retirement, but also help Americans save more and retire earlier than their counterparts. Americans who use a financial advisor expect to retire at age 64 – two years sooner than those who don’t work with an advisor. Additionally, the study found that those who worked with an advisor had saved twice as much for retirement versus those who did not work with an advisor.
“Financial advisors and comprehensive financial planning have never been more relevant or in-demand,” said John Roberts, chief field officer at Northwestern Mutual. “In this time of record-high financial anxiety, Americans are proactively seeking out expert advice for peace of mind.”
The study found that the impact of financial advisors is especially notable for African Americans. Black individuals who use a financial advisor expect to retire at the age of 61 – three years earlier than those who do not use an advisor. Moreover, Black Americans who used a financial advisor saved three times more for retirement than the average Black consumers who did not.
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Also noteworthy – the study found that younger generations are saving and investing their money earlier than previous generations. The average millennial with a financial advisor says they sought out financial guidance at age 29 – nine years sooner than Gen X and a full 20 years before boomers.
While many Americans already work with financial advisors, the study found that 7 in 10 Americans believe their financial plan needs improvement. The study recommends that those who begin working with a financial advisor earlier in life will see long-term benefits.