Younger Workers Prefer Online Financial Advice
Though the headline on the Wells Fargo/Gallup poll with over 1000 U.S. investors about their 401k plan is that 91% say they are satisfied with it as a retirement tool, digging deeper shows a bit of different results and highlights the way different generations want to access advice. Younger Workers Prefer Online Financial Advice
Of the 91% that view their 401k plan favorably, only 44% are very satisfied which is a method commonly used to determine real value. Not surprisingly, the most popular method to get advice on allocating 401k investments is through a personal advisor, but there is a gap between 50 and older investors and younger ones. Overall, 58% of investors list advisors as the most favored method, 63% of older investors want to speak to an advisor while just 52% of younger investors list that method as their favorite.
Tied with personally advisors is internet research with 66% of younger investors preferring that route compared to 49% of older workers. Online tools are more heavily used by younger investors by a wide margin as is advice from family and friends. Call centers are the least favored method to allocate 401k investments though twice as many older workers listed it.
Lessons for plan sponsors? One method of financial advice for all workers does not make sense. Though providing access to a personal advisor is important to older workers, younger ones prefer online tools and internet research along with peer review perhaps highlighting the value of social media. Regardless, providing multiple means of access to financial advice is key.
Which of the following tools or resources do you use to help you decide how to allocate your 401(k) investments?
Based on employed 401(k) participants
| Total% | 18 to 49% | 50+% | |
| A personal financial adviser | 58 | 52 | 63 |
| Internet research | 58 | 66 | 49 |
| Online investment calculators and other financial tools | 46 | 58 | 35 |
| Advice from family or friends | 40 | 50 | 30 |
| Target-date funds | 21 | 23 | 18 |
| Advice through a financial call center | 15 | 10 | 21 |
| Jan. 29-Feb. 7, 2016 | |||
| WELLS FARGO/GALLUP INVESTOR AND RETIREMENT OPTIMISM INDEX | |||
