More than half of middle-income Americans, those earning $30,000 - $100,000 a year, do not seek the help of a financial professional when managing their assets, according to a new survey by Primerica and the Consumer Federation of America.
As reported by Investment News, this lack of professional guidance often leads to costly mistakes. Two-thirds of those surveyed admitted that they have made at least one “really bad financial decision.”
The average assets of middle-income Americans decreased to $27,300 in 2010, from $37,000 in 2007.
Of those in the survey who have not consulted a financial advisor, 15 percent said they do their own financial research using the internet and television. Another 17 percent make decisions without doing any research.
At a time when the middle market needs sound financial advice more than ever, federal regulations – if they are not written carefully – could limit the access of these investors to professional advisors.
As Investment News notes, the Department of Labor and the Securities and Exchange Commission are considering rules that would require all financial advisors to operate under a universal fiduciary duty, potentially increasing the regulatory and liability costs for advisors.
NAIFA and other groups have raised concerns that poorly drafted rules could drive advisors out of business, or force them to raise fees or shift their business to wealthier clients.