Women and Younger Investors Lack Financial Literacy

Financial Advisors Weigh in on Money Acumen in AdviceIQ’s Inaugural Survey

NEW YORK--()--Financial advisors say women and individuals under the age of 45 are much less knowledgeable about personal finance than male and older investors, according to the first annual financial literacy flash survey conducted by AdviceIQ. Even though these investors are taking the right steps by working with advisors, they can benefit from further education about money matters to attain their financial goals.

In recognition of Financial Literacy Month, AdviceIQ captured the opinions of 350 financial advisors across the U.S. on their clients’ understanding of personal finance and the biggest challenges that they face with money.

Below are key findings from the survey:

  • Women continue to lag behind men in financial literacy
    Overall more than 60% of advisors said that most investors have an average understanding about personal finance but just 9% believed female clients more knowledgeable than men while more than 50% of advisors said male clients were more financially literate.
  • Younger investors lack financial awareness
    Although clients in their 30s and early 40s are working with financial professionals, only 6% of these young investors were viewed as financially savvy; by comparison, 75% of clients in their mid 40s and older were believed to be money-wise.

“Due to their personal interaction with investors, financial advisors can serve as a terrific barometer on the current state of investor knowledge, and the feedback we’ve received from our survey respondents reveals an urgent need for financial education that helps women and younger investors close the information gap and jumpstart their financial futures,” stated Nick Stuller, CEO of Advice IQ. “Part of the solution, are the advisors’ efforts to inform clients and to encourage a dialogue about money matters. At the same time, investors must take it upon themselves to improve their understanding of personal finance. This will ensure better financial outcomes as they work with advisors to grow wealth over time.”

Additional findings include:

  • Limited financial literacy impacts retirement savings
    More than a third of advisors (34%) said that the biggest mistake clients make is waiting too long to start saving. In general, this money challenge is closely correlated with financial knowledge.
  • Wealthier clients are the most financially literate
    Almost 60% of advisors viewed their wealthier clients as the most financially sophisticated while 37% did not view wealth as a factor when evaluating money skills.

The AdviceIQ financial literacy flash survey was conducted online in March 2013 using AIQ’s database of U.S. Financial Advisors to randomly poll thousands of advisors. Three hundred fifty advisors participated with representative client bases of both high-net worth and middle-income investors. Please visit http://adviceiq.com/financial-literacy-survey-2013 for a downloadable infographic with survey results. This is the first annual financial literacy flash survey released by AdviceIQ, a groundbreaking online directory of trusted financial advisors and publisher of syndicated personal finance content and advisor rankings.

About AIQ, Inc.:

AIQ, Inc. publishes the popular Meridian-IQ suite of Financial Advisor directories, licensed by over 500 major fund companies, broker-dealers and insurance companies for industry research and marketing purposes. AIQ is led by a veteran Wall Street team who are subject matter experts on retail financial advisors and investing.  Its consumer-facing product, www.AdviceIQ.com, combines daily personal financial journalism with listings and rankings of pre-vetted Advisors that are certified to have passed AdviceIQ’s proprietary Regulatory Compliance Review (RCR™), the strictest industry regulatory due diligence.

RCR™ attests to the quality of an advisor’s compliance history. This due diligence encompasses the entire disciplinary and complaint history of all four major U.S. regulators: Financial Industry Regulatory Authority (FINRA), Securities and Exchange Commission (SEC), State regulators who license Investment Advisor Representatives and State Insurance Commissioners. Investment firms pay an annual subscription fee to have each financial advisor undergo the RCR™ screening.  Only advisors who successfully pass the vetting process may have their profiles posted on www.adviceiq.com. RCR™ prevents advisors with serious infractions from appearing in the published listings and rankings.  It also excludes advisors censured by one regulator, who then move to another financial services industry and would otherwise escape scrutiny. AdviceIQ provides investors with access to trustworthy advisors who can help them take charge of their wealth and financial planning.

Contacts

Media:
For AIQ
Chenoa Taitt, 212-223-0689
ctaitt@rooneyco.com
or
Marion Janic, 212-223-4017
mjanic@rooneyco.com

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Contacts

Media:
For AIQ
Chenoa Taitt, 212-223-0689
ctaitt@rooneyco.com
or
Marion Janic, 212-223-4017
mjanic@rooneyco.com