The future financial security of senior Australians will be influenced by the effectiveness of their financial plans. Key to ensuring this goal is the financial literacy of the individual, as well as their access to appropriate professional financial advice.
This National Seniors Productive Ageing Centre report, authored by Paul Gerrans from the University of Western Australia and Douglas A. Hershey from Oklahoma State University, examines these issues in detail and reveals some valuable findings.
The research, based on findings of a 2011-12 survey of over 2,200 people aged 40-74 years, shows that financial knowledge is higher amongst people aged 50 years and over compared with their younger counterparts.
Men were found to have higher levels of self-assessed knowledge than females. Professional financial advice, which can assist individuals in their financial decisions, is currently used by 18% of respondents and previously used by 41%.
A key feature of this research is the investigation of financial adviser anxiety, which can arise from people worrying about sharing information about their finances or being negatively judged by a financial adviser because of their financial situation.
Around one quarter of respondents were found to have moderate to severe financial adviser anxiety. These people have lower financial literacy and lower income, as well as unsurprisingly a lower likelihood of seeking financial advice.
Australians face a complex environment in which to make their financial decisions, with a wide range of financial products available.
The authors suggest that public information campaigns sponsored by governmental and private sector sources could assist people’s attitude to their personal responsibility, which will help individuals in planning for their longer-term financial security.