Search

The purpose of this study is to investigate whether a professional designation affects consumer choice behavior within the area of investment decision making. Forty-six participants were endowed with real money and received hypothetical investment advice from a certified financial planner (CFP) Professional and a stockbroker. Among low-income households, advice from a CFP altered investor choice behavior within hypothetical education and retirement savings accounts. When participants made investment decisions using education funds and received advice from a CFP, the mean expected value of their investment choices was $43,913, compared to $25,870 given advice from a stockbroker. When investment decisions were made using retirement funds, the average expected value given advice from a CFP and a stockbroker was $53,424 and $33,207, respectively. If an investor was risk-neutral or risk-seeking, investment choices were improved when advice was rendered by a CFP relative to a stockbroker. [ABSTRACT FROM AUTHOR]

Using the Asset and Health Dynamics among the Oldest Old (AHEAD), this study presents the first longitudinal results analyzing factors associated with getting and dropping a financial advisor. We find that quantitative as well as qualitative factors are significant when evaluating the value of professional financial advice. Getting a financial advisor was positively associated with becoming a widow(er), asking family members for assistance with financial decisions, seeking professional help for emotional problems, and experiencing increases in income and net worth. Among single and widowed respondents, experiencing significant cognitive decline also increases the likelihood of getting a financial advisor. Dropping a financial advisor was negatively associated with becoming a new widow(er), getting married, and experiencing an increase in net worth. No longer involving family members in financial decisions was strongly related to dropping a financial advisor. We discuss implications for practitioners relevant to both client acquisition and client retention. [ABSTRACT FROM AUTHOR]