91% of retirees advised by a professional felt they had enough money to last their retirement: FPSB Study

As consumers continue to feel the pressure of high inflation, rising interest rates, and increased cost of housing, a new study released by Financial Planning Standards Board (FPSB) on the occasion of World Financial Planning Day on October 4, has found that Indians who worked with a financial planning professional report the best outcomes. The study titled ‘FPSB Value of Financial Planning Research report 2023’ reveals that 80 out of 100 Indian consumers feel professional financial planning services have helped enhance the quality of life, while 75 out of 100 feel financially more confident. As many as 91 per cent retirees advised by a certified financial planner (CFP) professional felt they had enough money to last their retirement happily.  

The FPSB Value of Financial Planning Research 2023 was undertaken by FPSB Ltd and FPSB India by independent research firm MYMAVINS, surveyed 1,011 advised and unadvised Indians aged 25 and over, and earning over Rs 45 lakh per annum or holding over Rs 45 lakh in investable assets or equivalent. 

The report was released on the World Financial Planning Day with the ceremonial bell ringing at BSE. Krishan Mishra, CEO, FPSB India, said, “Our commitment to empowering consumers with financial knowledge is unwavering. Today, we present a comprehensive study encompassing both advised and unadvised Indian consumers. It’s heartening to note that financial planning, especially when delivered by CFP professionals, plays a pivotal role in shaping a secure financial future. It is a testament to the value they bring to individuals seeking financial guidance.”   

While close to 3 in 5 (76 per cent) clients of financial planners are highly satisfied with their overall level of wealth, compared to 63 per cent unadvised consumers, the study has found that around 9 in 10 (94 per cent) clients of CFP professionals feel financially secure and a similar proportion 9 in 10 (95 per cent) feel tangibly better off.  

“This report represents a significant contribution to our understanding of the impact and effectiveness of professional financial planning services in the lives of individuals. It sheds light on the value that Certified Financial Planner professionals bring to the table and provides valuable insights for the industry. We appreciate FPSB India's dedication to promoting transparency and excellence in financial services, and we believe that this report will be a valuable resource for both practitioners and consumers in shaping the future of financial planning in India,” said Manoj K Tiwari, Director, IIM-Mumbai.   

The study examined the value of financial planning, measuring the financial and non-financial impact of financial planning across quality of life, financial confidence, financial satisfaction and experienced value, while debunking the myths surrounding financial planning and analysing the future of the profession. 

While unadvised Indians recognise improved financial well-being and peace of mind (42 per cent) and greater wealth growth (43 per cent) as key benefits of seeking financial planning, 27 per cent Indians perceive it as too expensive and 32 per cent find it hard to consult someone trustworthy.  

However, close to 9 in 10 (97 per cent) clients of CFP professionals say the value of financial planning outweighs the cost, with everyone (100 per cent) advised by a CFP professional reporting they trust their financial planner to act in the best interests of the client.  

Dante De Gori, CFP, Chief Executive Officer, FPSB Ltd. says, “In this current volatile climate, where unexpected events can send shockwaves through the global economy, the role of financial planning in general and of CFP professionals in particular has become even more critical in empowering consumers to make informed financial decisions and achieve their long-term goals, while enjoying a better quality of life.”  

The study also found that 70 per cent percent of advised Indians with an income of Rs 65 lakh and less report improved family life, improved social life (53 per cent), improved mental health (61 per cent) and increased work satisfaction (62 per cent).   

 Moreover, Over 1 in 2 (60 per cent) of Indians who work with a CFP professional have reported financial advice positively impacted their mental health and family life. In addition, 76 per cent of clients who work with CFP professionals generally feel they can cope well with any health issues compared to 71 per cent of unadvised Indians. The study also reveals that clients of CFP professionals report the highest quality of life score (82/100), compared to those who work with other financial planning professionals (79/100) and the unadvised (76/100).  

The sample included both advised and unadvised consumers. Advised consumers are those who are currently working with a financial planner, those who seek financial advice as needed and those who have received financial planning advice in the past three years but not now. Unadvised consumers, on the other hand, are those who have never received financial planning advice from a financial planner or have not received financial advice in the past three years.  

FPSB’s network of professional financial planning bodies in the following territories participated in the global research- Australia, Canada, Chinese Taipei, Hong Kong, India, Ireland, Malaysia, the Netherlands, New Zealand, People’s Republic of China, Republic of Korea, Singapore, South Africa, the United Kingdom and the United States.  

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