In this challenging state of our economy and increasing unemployment numbers, nearly 30% of over 35 year olds are feeling financially stressed, and one in five Australians say that they do not feel confident in managing their household finances.

In a recent IFA podcast episode hosted by Sarah Kendell was guest Anne Fuchs, head of advice and retirement, Sunsuper. They highlighted some research that Sunsuper commissioned back in July, during the peak of COVID-19, that surveyed 1500 “ordinary” Australians to help gain an understanding of what post-COVID advice might look like.

According to the survey, financial stresses that people in the 35 year old demographic are most concerned about include cashflow and budgeting; putting more into superannuation; paying off the mortgage; and saving for kids’ education. In addition to this, many people are feeling overwhelmed with their debt and want to find a course to help pay it down. Notably, there appears to have been an increased level of importance placed on having adequate “emergency money”, which is certainly a positive development as there has been plenty of evidence to show that many households spend more than they earn. No doubt the mass closure of various industries due to the onset of COVID gave many households a reality check to save for a rainy day, or in the context of COVID, a rainy year.

Superannuation continues to be a big focus for all demographics, with 40% of those surveyed saying they were not confident that they will have enough money when they retire. A notable trend arose in the 35 year old demographic, who also indicated they are becoming increasingly concerned about their retirement. Given that many Australians have accessed somewhere in the order of $42B in superannuation savings, this is evidently an area of growing concern. Furthermore, 28% of baby boomers feel it is too late to do anything about it, stating that they were “too embarrassed” to seek help on the issue and regretted not acting earlier.

The underlying problem here is that only one in ten Australians seek comprehensive advice on their finances. Which means 90% of the population are without any ongoing financial advice, even though 20% of the 45 year old demographic surveyed said they needed financial advice now more than ever. Again, if you take superannuation as one example of a person’s wealth profile, most don’t know where their money is being invested, what insurances are covered, and are likely to have multiple superannuation accounts. Ann Fuchs reported that people who use an adviser are seven times more likely to increase their voluntary contributions, and are twice as likely to have consolidated Super accounts. Overall that means they will possibly be about $200k better off at retirement. So we need to find a way to get younger people to engage advisers sooner and not wait until they are nearing retirement, at which time it is often too late to have any impact.

The good news, according to Anne Fuchs, is that the combination of the Royal Commission and Covid-19 has resulted in people across all demographics paying much more attention to their finances. To grow the pool of advised clients across Australia, Anne Fuchs recommends that advisers start small – with targeted advice, and build from there in order to develop trust with clients and demonstrate value in increments. There’s merit to this approach, and is best partnered with giving clients better visibility of their overall financial position through client portal technology. This is the key value that myprosperity delivers and is the best starting point for engaging any new or existing client. It is a simple, low cost, entry level way of giving clients a holistic view of their finances to drive better engagement in their whole-of-wealth journey. As an adviser, having access to real-time data across your entire client base gives you valuable insights, and importantly, allows you to achieve that efficiently and at scale.