SMSF trustee appetite for advice returns

The six-year decline in the number of SMSF trustees obtaining financial advice has now stabilised, with 41 per cent having acquired advice within the past 12 months, according to a new report.

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by Miranda Brownlee - July 31, 2014 1 comments

The 2014 Self-Managed Super Fund Planner Report produced by investment management company Vanguard and investment research provider Investment Trends also showed 54 per cent of SMSFs are now open to using an adviser’s expertise.

The report, which surveyed 489 financial advisers in April, indicated trustee satisfaction with advisers has also increased in the past 12 months, climbing to its highest level since the GFC.

“Furthermore, a projected 286,000 SMSFs have unmet advice needs they are willing to pay for,” said the report.

Vanguard head of adviser distribution Michael Lovett said these finding demonstrate the “significant opportunity professional advisers have to expand their service offering in the SMSF sector”.

“The willingness of SMSF investors to engage with a financial adviser continues to increase, particularly around unmet advice needs such as inheritance planning and protection of assets against market falls,” said Mr Lovett.

The research found a number of elements contributing to SMSF trustee satisfaction with advisers, including “technical expertise, tax expertise, quality of support staff and clarity of fees and charges”.

“The challenge for advisers is to demonstrate that the value of good financial advice is much broader than investment selection,” said Mr Lovett.

The cost of advice remains a concern for SMSF investors, according to the report. However, an increasing number of trustees say they prefer face-to-face advice, even if it is more costly.

The research also showed an increased focus on diversification, with over a quarter of all SMSF investors making substantial allocation changes in order to increase the diversification of their SMSF.