Young Aussies seeking advice but many can’t afford it

According to research commissioned by Colonial First State (CFS), which surveyed almost 2,000 consumers in July, 53 per cent of Australians aged 16 to 39 are open to financial advice, compared with 36 per cent for those aged 40 to 59 and just 15 per cent for those over 60.

However, the research also found that despite being open to advice, 35 per cent of under 40s said they couldn’t afford it.

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Josh Grace, group executive – customer office at Colonial First State, said in addition to cost being the most significant barrier for those under 40, there is also an awareness and knowledge gap.

“Many younger Australians want advice but don’t know where to start. The research found that 18 per cent of under 40s don’t know the right questions to ask and 15 per cent admit they don’t know how to access a financial adviser,” Mr Grace said.

“It is critical that younger Australians who clearly want advice are able to access it.”

He added that digital advice and other alternative advice models could bridge the gap for Australians until they are able to afford more comprehensive, face-to-face advice.

“We want more Australians to get some type of advice and we also want to see financial advisers freed up to be able to provide more tailored and single-topic advice so they can support more Australians to achieve their financial goals,” Mr Grace said.

“CFS supports a vibrant advice sector. We want to see more Australians benefiting from access to advice and we want it to be easier for financial advisers to provide advice to those who need it.”

Looking at digital advice, the research found that more than half of all Australians (53 per cent) are open to digital advice, while 20 per cent are not and 28 per cent are unsure.

The demand is even stronger among younger Australians, with 63 per cent of under 40s admitting they are open to a digital advice solution, while one in four said they had already used them.

The survey follows earlier CFS research, released last week, which found that while the majority of Australians don’t feel positive about their financial future, advised Australians feel much more optimistic.

According to CFS, in a controlled sample of consumers with the same levels of wealth and household income, 68 per cent of those with a financial adviser said they are positive about their current financial position, compared to just 45 per cent of unadvised respondents.