Research conducted by the National Seniors Productive Ageing Centre has found that older Australians are reluctant to seek financial advice.
The research was compiled by Paul Gerrans from the University of Western Australia and Douglas A Hershey of Oklahoma State University and published in a report entitled The Role of Financial Literacy and Financial Adviser Anxiety in Older Australians’ Advice Seeking. It found that a significant number of seniors find discussing financial matters embarrassing.
Of the Australian seniors surveyed, 46 per cent indicated they would experience “mild anxiety” speaking to a financial adviser, while 25 per cent of respondents indicated “moderate to severe” anxiety levels.
Some respondents indicated they consider seeking financial advice akin to discussing embarrassing health and personal issues with a doctor.
As well as potential embarrassment, the report found anxiety over potential judgment about poor investments and financial decision-making and discomfort with financial jargon.
An additional 47 per cent of respondents suggested they could only cover their expenses for a period of six months before borrowing money or moving house if they lost their main source of income. The report found that a significant number of older woman in particular do not sufficiently understand superannuation or pension schemes.
Responding to the report’s findings, National Seniors Australia (NSA) has called for the financial planning industry and government to help older Australians to become more financially literate and create incentives for them to seek financial advice.
“Knowledge is power and older people need to feel confident in discussing their financial futures,” said NSA chief executive Michael O’Neill.
“Finance professionals should also take steps to gain the trust of their clients by explaining their options in layman’s language and addressing their concerns from the very first meeting,” he said.
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