This Poll is a Reminder to Financial Advisors to Market at Square One


The latest results from a National Financial Educators Council survey remind me of an important best financial education lesson.

A few years ago, I was marketing a financial newsletter with stock picks and education on how to engage in DIY asset allocation.

We sold A LOT of newsletters over a period of three weeks. But we suddenly noticed a huge refund rate – over 40%. We’d received names from external lists, but we didn’t do our homework around the financial literacy of that audience.

When we couldn’t figure out why refund rates were so high, we reached out to those customers who canceled by phone. What I found was pretty alarming. Here we were telling people to start a brokerage account and buy stocks. 

This Survey is Eye Opening

They didn’t even understand what this meant. We assumed that these readers knew how to buy and sell stocks. We found many didn’t even know what a broker was. Our marketing got people excited about investing in the market. They didn’t know where to start.

A new survey by the National Financial Educators Council (NFEC) reminds me of that marketing campaign. According to a survey of 1,251 Americans, the number of people turning to financial professionals lags the numbers seeking assistance from their inner circles. 

Respondents were asked one question: When you have a financial question, who do you personally turn to for trusted financial guidance?”

  • 39.6% of the respondents said they asked parents, family, friends, or coworkers.
  • 35.9% said they turned financial professionals.

But here’s the most interesting data point.

Roughly 24.4% responded “I Don’t Have Anyone Trusted to Turn To.”

The NEFC says that the “results indicated that many people lack access to trusted, qualified professionals who offer financial guidance, especially the younger adults who responded.” It’s also critical given that the bulk of Americans cannot pass a financial literacy test.

Trust remains at the heart of the client-advisor relationship. According to a Personal Capital survey, roughly 32% of Americans suspect that an advisor will “likely” take advantage of them.

And of 54% of Americans who choose not to work with advisers, about 45% say that Trust is the reason.

Looking ahead, messaging around trust will be critical in prospecting. But so too is communicating the knowledge around financial basics. We tend to assume that people have some knowledge that we have after years of education and training.

But this industry continues to show a huge divide. Starting at the basics can be time-consuming, but they are necessary. Not only will this practice help instill trust, but it will also empower new investors to take part in the world’s greatest wealth-building engines in the financial markets.

I learned that lesson as a marketer.