80% Indian Consumers Credit Financial Planning For Improved Quality Of Life: Report

At least 80 out of 100 Indian consumers feel that professional financial planning services have helped enhance their quality of life, as revealed by a recent study. Additionally, 75 out of 100 individuals report feeling more financially confident.
 
The FPSB Value of Financial Planning Research Report 2023 also indicated that 91 per cent of retirees advised by a CFP professional felt they had enough money to ensure a happy retirement.
 
 Krishan Mishra, CEO, FPSB India said, “As we navigate the complex world of finance, let this report serve as a compass, illuminating the path towards financial well-being for all. Together, we can create a more financially secure future with correct and pragmatic advise."

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," said Prof. Manoj K Tiwari, Director, IIM-Mumbai. 

While unadvised Indians recognize 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 findings in this global study illuminate a compelling reality: the immense value that CFP professionals bring in supporting clients’ financial needs amid times of uncertainty, reinforcing the reputation of CFP certification as the global symbol of excellence in financial planning,” De Gori added.

The study also revealed the following key findings:

Financial planning benefits more than just the wealthy. The study finds that 70 per cent percent of advised Indians with an income of INR 65 lakhs 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). 

Financial advice unlocks benefits beyond money by improving overall mental health. 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).

Clients of CFP professionals show a strong level of trust in their financial planners. The report reveals that Indians found more value working with a CFP professional (with score of 82 out of 100) than an adviser who is not a CFP professional (79 out of 100.)Trust is also significantly high as 100 per cent of clients who work with CFP professionals trust their financial planner to act in the client’s best interests and 98 per cent of those who work with a CFP professional are likely to continue the relationship with their financial planner.