SMSFs with unmet advice needs growing

According to the latest Vanguard/Investment Trends SMSF reports, a lack of confidence in the expertise of advisers is now the number one barrier for SMSFs seeking advice on their unmet needs sitting at 32 per cent, with adviser fees the second biggest barrier at 30 per cent.

Despite the barriers, over a third of financial planners expect their SMSF business to increase over the next three years (36 per cent), compared with 15 per cent who expect it to decline.

The number of SMSFs with unmet needs jumped from 275,000 in 2018 to 315,000 in 2019, with their top advice needs relating to estate planning, tax and income strategies, post-retirement planning, portfolio strategy and investment selection, the survey found.

The survey revealed that the number of SMSFs that use a financial planner has remained steady throughout most of the past decade but overall satisfaction with financial planners has declined to a seven-year low, with falling satisfaction with level of fees and perceived value for money being the key satisfaction gaps to address.

Vanguard Australia head of intermediary Rebecca Pope commented on the value this research can provide financial advisers in uncovering the key advice needs of the sector.

“This year’s report showed the ongoing challenge for advisers to find and retain new SMSF clients. This research has for years highlighted areas of unmet advice for SMSF trustees, with the top needs almost always focused on areas such as estate and tax planning, providing valuable insight for those seeking to build up their SMSF business,” Ms Pope said.

“The report also provided some insights for advisers into SMSF trustees’ attitude to alternative forms advice, with more than half saying they would consider over the phone or advice via web chat if it would reduce the cost of the advice service.”

Adrian Flores

Adrian Flores is a deputy editor at Momentum Media, focusing mainly on banking, wealth management and financial services. He has also written for Public Accountant, Accountants Daily and The CEO Magazine.

You can contact him on [email protected].