Filed Under:Life Insurance, Life Planning Strategies

Why clients withhold financial info from advisors

A majority of the respondents describe as “too personal” financial information they don't share with their advisor.
A majority of the respondents describe as “too personal” financial information they don't share with their advisor.

Nearly one-third of individuals have not shared certain topics related to their financial situation with their advisor, according to a new report.

Securian Financial Group reveals this finding in a survey, “What people don’t tell their advisors and why.” The report polled 720 people age 30 and older who have a financial professional. About two-thirds of the respondents (68 percent) are “mass affluent” consumers with annual household incomes ranging from $50,000 to $149,000.

When asked to describe the aspects of their financial situation they have not shared with their advisor, 36.9 percent of the survey respondents identify health concerns, and 32.5 percent point to private investments they’ve made.

The following are other topics respondents withhold from their advisor:

  • Personal loans to friends or family members — 29.6 percent;
  • Debts incurred — 25.7 percent;
  • Stocks purchased — 18 percent;
  • Real estate purchased — 15.5 percent;
  • Life insurance policy purchased — 11.7 percent;
  • Spouse started a new job — 10.2 percent;
  • Started a new job — 8.7 percent;
  • Other financial-related topics — 4.9 percent.

As to the reasons why they choose not share this information with their advisors, 51.5 percent say the topics are “too personal.” Significant percentages flag the following:

  • Believe the information is beyond the realm of financial strategy — 44.7 percent;
  • Embarrassed — 20.4 percent;
  • Happened recently and have not had an opportunity to share yet — 16 percent;
  • Do not trust or feel uneasy sharing every detail with the advisor — 10.7 percent.

When questioned what changes they would make if their advisor were privy to the undisclosed financial information, respondents answer as follows:

Response

Percent selecting

Number selecting

Increase amount I am saving

28.9%

59

Create a new financial plan

25%

51

Reallocate my investments

23.5%

48

Explore investment alternatives

21.6%

44

Decrease my current spending

20.6%

42

Purchase more insurance

10.3%

21

Divest specific investments

9.8%

20

Explore housing alternatives

7.8%

16

Take out a loan

5.4%

11

Other

17.2%

35

     
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