According to a recent survey conducted by *Netwealth, wealthy Australians like to plan. Typically, they are highly educated, highly paid professionals or senior managers and while they are aged from 45 years, on average they are 60 years old. They proactively engage in their financial affairs and a very strong 64% consider themselves financially resilient.
Sound familiar? In this article, we reflect on Netwealth’s report in context of our own experience advising clients and helping them to achieve what really matters in what can be regularly changing financial and wealth circumstances, especially during the middle and pre-retirement years of life.
The Netwealth 2022 Advisable Australian Report refers to this group of Australians as ‘The Established Affluent’ and as you’d expect, they largely comprise Baby Boomers (58%) but there’s a significant number of Gen X (35%) too.
A little over half (53%) are still working and of those, a substantial percentage (28%) are executives or senior managers, one tenth own businesses, while just over a quarter are retired.
The report also revealed, these so-called established affluent Australians like to plan, they are optimistic about the future and genuinely care about environmental and social issues.
They also recognise they have complex financial needs that require time as well as specialised knowledge for managing and creating wealth opportunities.
Their needs are often influenced by regularly changing circumstances in the middle years and pre-retirement stages of life that affect their personal, family and professional life. Among them matters such as divorce and re-partnering, job promotions and redundancy, ill health, inheritance and generational wealth transfer, among a raft of other matters.
Even so, they felt financially resilient, with 64% indicating they could live off their savings without income for more than a year, while 78% felt they were prepared for retirement.
What’s more, this group also indicated they worry less. 44% worry rarely (only a few times a year) and a further 20% declared they don’t have any financial issues.
In the coming 3 years from 2022, 62% will work towards ensuring they have enough money to retire, while 43% want to ensure their wealth is wisely invested and managed and of them 58% expect to lean on their financial adviser for advice and services for that purpose.
Further, 43% aim to ensure their family can manage the family wealth if they became ill or passed away, 33% were proactively planning their wealth transfer to next generations and 32% indicated tax management would be necessary for achieving their financial goals.
Okay, so that’s enough statistics!
Our experience advising clients here at Stratus Financial Group is very similar, and if you’re reading this and thinking it all feels very familiar, it’s because it is.
Typically, our clients also sit in the 45+ age group and have an average age of 60. They too are financially capable but even so, they value financial advice and guidance when making financial decisions about many of the matters raised in the report.
We offer ourselves as something of a professional sounding board when our clients need to make decisions and our holistic approach addresses a broad range of aligned matters including tax, legal issues, property, debt and other consideration that can affect financial planning outcomes.
For those who know us, we are dedicated to holistic financial planning, having incorporated this approach in our practice years ago. In 2019 we achieved external validation for our efforts winning the first of three ifa (Independent Financial Advisers) Holistic Financial Advice Firm of the Year awards.
As the Netwealth report indicated, financial resilience is important and it’s central to our approach as it directly influences how much, or more’s the point, how little our clients worry about their financial success, particularly on occasions when things take a turn for the worst.
Helping clients to become financially resilient involves providing advice and services that answer the question will I have enough, while considering bigger and longer-term issues.
Financial resilience commonly includes advice for appropriate personal risk insurances, a regular superannuation contribution strategy and creating retirement income streams.
Then there are other matters, sometimes seen as being outside of financial planning but nevertheless can have important financial planning impacts. These include asset protection, Wills and estate planning, intergenerational wealth transfer, business succession, asset protection, tax management and legal matters that require financial advice in collaboration with other professionals aimed at achieving seamless overall outcomes.
Financial education is also important.
We constantly educate ourselves and our clients. We do this during regular progress (review) meetings and through our communication program which includes our Knowledge Centre newsletter and articles such as this one.
Aside from our technical expertise, successful holistic financial advice is based on truly knowing our clients. Knowing our clients’ values and attitude can have a direct bearing on financial strategies.
As the Netwealth report noted, ESG (Environmental, Social & Governance) issues are a genuine consideration for many people which can influence decision making when investing in certain types of shares. Similarly, understanding a client’s attitude to risk will also contribute to personalised investment approach.
For our clients reading this article, sharing Netwealth’s findings in context of our approach aims to reinforce our commitment to remaining informed and proactive in meeting your needs now and over the long term. For other readers, including those who may be in the process of finding a financial planner, we hope this snapshot of our approach provides food for thought.
If you or someone you know would like to know more about our holistic financial advice approach or any of the matters raised in this article, please contact Brett Cribb, Steve Nicholas or James Marshall on +61 (0)7 3007 2007 or emailing firstname.lastname@example.org and we’ll Make it Happen.
Stratus Financial Group and its advisers are Authorised Representatives of Fortnum Private Wealth ABN 54 139 889 535 AFSL 357306. This information does not consider your personal circumstances and is of a general nature only. You should not act on it without first obtaining professional financial advice specific to your circumstances.
Please note: Credit advice is not offered under the Fortnum Private Wealth AFSL. When required, we refer to appropriately qualified professionals.