Investing 101

The value of financial advice

A new poll underscores its importance

Finding your way through the maze of financial products offered every day is no easy task. That’s probably the main reason why a recent survey carried out by Ipsos Reid for the Investment Funds Institute of Canada (IFIC) found that investors with a financial advisor were more confident about their future than those without one. In fact, 74% of those surveyed who had an advisor felt that they would have enough money to retire on, compared to just 53% who did not have expert advice.

The Ipsos Reid findings are part of a larger industry discussion surrounding investing and retirement. Listed below are further findings from the Ipsos Reid poll.

  • 50% of respondents said financial advice is more important for them today than two years ago.
  • 72% with a financial advisor were satisfied with their current financial situation, compared to 53% without an advisor.
  • 71% with an advisor felt they would be better off a year from now compared to 57% for those without an advisor.
  • Respondents with an advisor held a greater percentage of stocks and mutual funds while those without an advisor tended to hold a larger proportion of conservative assets such as GICs. (We believe this may mean that investors with a financial advisor are better positioned for capital appreciation and the attainment of their retirement savings goals.)

Ipsos Reid also studied investors by household. They concluded that families with a financial advisor had more invested in RRSPs, RRIFs and RESPs than those without an advisor.

  • 69% of households with an advisor held RRSPS, compared to 29% for households without an advisor.
  • 55% of households with people over the age of 65 with a financial advisor held RRIFs, compared with just 18% for those without an advisor.
  • 30% of households with people over the age of 45 with an advisor had RESPs, compared to just 10% of households without an advisor
  • 27% of households with an advisor had investments in Tax-Free Savings Accounts compared to 14% without advisors.

How the information was compiled

In addition to interviewing nearly 10,000 individual Canadians about investing and financial advice, Ipsos Reid analyzed information from more than 3,000 households.