Americans have doubts about whom they can trust with their finances, a new report released Wednesday by Personal Capital finds.
Personal Capital, a digital wealth management firm, said many people are unaware that financial advisors do not always work in their best interests, and need to be better informed about how to work with advisors to protect and grow their retirement savings.
Harris Poll conducted an online survey on behalf of Personal Capital in early March among 2,178 U.S. adults, 1,301 of whom had at least one investment account.
Seventy percent of survey participants said that recent events in the financial industry had made them question financial professionals’ trustworthiness, with men being less forgiving than women.
Some four out of five respondents said they would no longer trust their financial institution if it were involved in a scandal, and as many said they would switch institutions if theirs were caught up in one.
The report found many survey participants suspicious of financial advisors. Thirty-two percent believed that an advisor was likely to take advantage of a consumer.
Of the 54% who do not work with one, 45% said this was owing to lack of trust. In contrast, the vast majority of those who work with an advisor said they trusted that person to act in their best interest when managing their money.
When it comes to investment fees, investors’ knowledge is low and incorrect notions abound.
Twenty-one percent of respondents who had at least one investment account knew they paid investment fees, but did not know the amount they paid. Ten percent could not even say whether they paid fees.