Budgeting a Business Opportunity for AdvisorsBy Andrew Rickard | February 06 2015 08:29AM
Research conducted by industry research group LIMRA shows that developing and sticking to a monthly budget is a top financial priority for 52% of middle-income Americans. What's more, they want financial advisors who can help them put this budget together.
“When middle market consumers are considering a financial advisor, 77% say they want someone who is willing to educate and explain what they don't understand about finances,” says LIMRA. “Today's advisors are expected to know more about clients than just their account balances. Providing help on basic budgeting could go a long way to improving a client's financial outcomes now and in the future.”
LIMRA suggests that the recent drop in gas prices represents an opportunity for financial advisors to rework household budgets. According to the Energy Information Administration the average household in the United States will save $550 in gasoline purchases this year, and these funds could be used to meet other financial goals.
“An advisor could illustrate how saving that $550 for 25 years at 5% could add nearly $3,000 to a retirement account. At 7%, it grows to nearly $5,000,” notes LIMRA. “This example serves a larger point that by following a budget, consumers can develop better habits and act on saving opportunities.”