“Why more young advisers are needed to replace those retiring” - Philip James Financial Services (2024)

FAQs

“Why more young advisers are needed to replace those retiring” - Philip James Financial Services? ›

The average age of a financial adviser is 59. Many of those above the average are hoping to hang up their laptops and swap their brogues and ties for sandals, socks and cardigans in the not too distant. 75% of advisers are over 40 and only 8% under 30.

Using a financial advisor isn't mandatory. If you can't afford, don't trust, or otherwise would prefer not to use an advisor, managing your retirement on your own is always an option. You have to map out a sensible plan and be willing to follow it. Here are some of the basics of a do-it-yourself strategy.

According to various studies and publications, the average age of financial advisors is somewhere between 51 and 55 years, with 38% expecting to retire in the next ten years.

Lack of work ethic. It takes a lot of hard work and discipline to break into a career as a financial advisor. While many are willing to work hard for a period of time, fewer are willing and able to maintain the high-level work ethic required to survive and thrive as a successful advisor.

If you're wondering whether doom and gloom stories about financial advisors becoming obsolete, here's some reassurance: people will always need financial advice. And while technology may satisfy some of those needs, it's not a perfect solution or an adequate replacement for a human financial advisor.

62% of adults age 50 and older have not used professional help to plan for retirement. Here's why. Reaching retirement with enough money to live on is a big-ticket goal. Yet, many people have not consulted with a professional to make sure they're on track.

Generally, having between $50,000 and $500,000 of liquid assets to invest can be a good point to start looking at hiring a financial advisor. Some advisors have minimum asset thresholds. This could be a relatively low figure, like $25,000, but it could $500,000, $1 million or even more.

Allspring also noted via email response that 53% of near-retirees have used a financial adviser, which was about flat to last year's figure; the firm expects that percentage to remain steady. The survey did, however, find potential for retirement participants to seek individual services through their employer.

The study reveals that 70% of millionaires work with a financial advisor, compared to just 37% of the general population. Moreover, over half (53%) of wealthy individuals consider their financial advisors their most trusted source of financial advice.

A quarter of surveyed clients considered switching to a new advisor, with an additional 21.8% actually making the jump to a new advisor or a robo-advisor. A little over half of surveyed clients (52.9%) did not switch, nor did they consider switching.

What do financial advisors struggle with most? ›

Financial advisors are most concerned about business development. Nearly 80% cite the challenge of finding “ideal” clients (Exhibit 1). While an “ideal” client will vary among financial advisors, sourcing them instead of less preferred clients is a big deal.

For instance – did you know that according to a study¹ from Etrade Advisor Sales in 2019 – the average percentage of clients that leave during a given year is 20% within a year. And 25% within one-two years. Or - put another way - roughly one-fourth of new clients may leave within the first two years.

That position will allow other advisors in the area to go after your clients and pick them off with their marketing efforts. 5. The Statistics: 80-90% of financial advisors fail and close their firm within the first three years of business. This means only 10-20% of financial advisors are ultimately successful.

The Bureau of Labor Statistics has projected that 42,000 new financial advisor jobs would be added between 2022 and 2032. That will increase the total number of positions 13% over the decade from 227,600 in 2022 to 369,600 in 2032.

Financial advisors and insurance agents may have a certain reputation in many circles. While I believe the majority are honest, some advisors may give the rest a bad name by focusing on the commission instead of the client. And, even if you meet an honest advisor, how can you know they will do the job suited for you?

Lack of perceived need. Many consumers share the perception that they simply don't need a financial planner. They may receive financial advice from a family member or friend; in some cases, they feel they've already achieved their goals and thus don't require advice.

Limited availability: Financial advisors may not be available at all times, which can be a problem if you need urgent advice or assistance. Risk of scams: unfortunately, there is a risk of financial scams in the industry, and it's important to be aware of this risk when working with a financial advisor.

This depends on your comfort level with managing every aspect of your finances. It's not common for a layperson to have the knowledge and discipline to do that on their own. Those who do may not have the time or the inclination. A financial advisor could provide invaluable support and guidance.

More? Financial planners often recommend replacing about 80% of your pre-retirement income to sustain the same lifestyle after you retire. This means that, if you earn $100,000 per year, you'd aim for at least $80,000 of income (in today's dollars) in retirement.