FPA announces new advice index

The Financial Planning Association of Australia (FPA) has announced the launch of its new Value of Advice (VoA) index which measures the quality of life, financial advice and satisfaction of Australians based on research conducted by MYMAVINS.

This comes after the study completed by the research consultancy on over 1,000 Australians aged over 40 found those with an “active relationship” with a financial planner are more financially comfortable and have a better quality of life than those without.

The research also showed the top 10 benefits from having a financial planner included:

• Greater confidence in having a comfortable retirement (47 per cent)
• Improved financial wellbeing (40 per cent)
• Improved financial decision making (37 per cent)
• Improved money management (33 per cent)
• Improved general wellbeing (e.g., peace of mind, health and social aspects) (32 per cent)
• Improved ability to achieve desired standard of living (32 per cent)
• Helped you achieve your financial goals (30 per cent)
• Greater financial control (28 per cent)
• Greater wealth growth (28 per cent)
• Improved financial freedom (27 per cent)

“Australians with an active relationship with a financial planner are better off in multiple ways,” FPA chief executive, Sarah Abood, said.

“They suffer less financial stress, enjoy a higher quality of life, have more financial confidence, and are more satisfied with their wealth. Regardless of the client’s wealth or age, the study found advice promotes and enables better quality of life.

“On average, advised Australians rate their overall life satisfaction at 7.3 out of 10, significantly higher than the 6.4 rating from the unadvised.

“Advised Australians are also significantly more likely to feel financially secure than those who are unadvised (85 per cent vs 62 per cent) and are more likely to feel very or completely satisfied with their current level of wealth (35 per cent vs 18 per cent).”

The index will seek to provide a year-on-year comparison to reflect how Australians value financial advice, with this year’s inaugural index findings showing advised Australians had improved financial outcomes across the board.

Abood said the research also indicates who received financial advice Australians believe it to be worth every cent.

“Advised Australians overwhelmingly believe advice has made them tangibly financially better off and that its value outweighs the cost,” she said.