All Financial Advice for the Middle Class is Not Equal

Danielle Winchester () and Sandra Huston ()

Journal of Consumer Policy, 2015, vol. 38, issue 3, 247-264

Abstract: Professional financial advice has been shown to improve the financial well being and stability of US households. However, less than 2% of middle-class households use the services of a financial advisor compared to 60% of affluent households. Many contend that this difference is a result of the middle class’s belief that financial advice is only beneficial to the wealthy. This study is one of the first to empirically test this sentiment, and it finds that middle-class households who are comprehensively managed are more than three times as likely to be well prepared for retirement, more than twice as likely to use their employee benefits appropriately, and nearly twice as likely to have an adequate emergency fund compared to households who do not purchase financial advice. These findings demonstrate that, although goals may differ between middle-class and affluent households, financial advisors have a positive influence on household financial behaviours regardless of economic class. Results from this study suggest that financial advice, particularly comprehensive financial planning services, should be promoted to US middle-class households and that financial planners should be encouraged to serve the middle-class market. Copyright Springer Science+Business Media New York 2015

Keywords: Middle class; Financial advice; Value; Behaviours (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://hdl.handle.net/10.1007/s10603-015-9290-8 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kap:jcopol:v:38:y:2015:i:3:p:247-264

Ordering information: This journal article can be ordered from
http://www.springer. ... es/journal/10603/PS2

DOI: 10.1007/s10603-015-9290-8

Access Statistics for this article

Journal of Consumer Policy is currently edited by Hans Micklitz, John Thøgersen, Lucia A. Reisch, Alan Mathios and Christian Twigg-Flesner

More articles in Journal of Consumer Policy from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().