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Life Health > Health Insurance

Your Clients Are Stressing Out About Their Health: Fidelity

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It will come as no surprise that health concerns weigh on Americans across the wealth spectrum, millionaires included.

Fidelity Investments’ most recent Millionaire Outlook Study, which analyzed the investing attitudes and behaviors of some 2,000 households, found that concerns about health were the main source of stress for both millionaires and their less-wealthy counterparts.

Stressed millionaires report a greater disconnect with their financial advisor, the study finds.

“There are a lot of stressors in life that are universal and difficult to predict, like health issues or the state of the economy,” David Canter, head of the registered investment advisor segment at Fidelity Clearing & Custody Solutions, said in a statement.

“Regardless of net worth, proactively planning and managing financial resources can help alleviate stress. Advisors need to be thinking broadly about how financial planning can impact clients of all asset levels to help historically underserved segments have access to the benefits of financial advice and planning.”

The survey was conducted in August among 2,026 investors, including 1,102 millionaires, the sample provided by Brookmark, a third-party firm not affiliated with Fidelity.

The survey results showed that more than one-third of both non-millionaire and millionaire investors had health-related concerns, which accounted for the largest proportion of their overall stress across the four areas of total well-being included in the study: health, financial, work and life.

In terms of health, millionaires worried, first, about their weight, then their own health and then their family’s health; for non-millionaires, weight was first, followed by their family’s health and their own health.

Of the millionaires who reported higher levels of stress, fewer than half said they felt confident about their health, compared with 86% of those who reported lower stress levels.

Forty-five percent of millionaires who reported higher stress levels expressed concern about paying for health care, versus just 7% of their non-stressed counterparts, and 20% cited planning for these expenses in retirement as one of their top investment goals, versus 12% of the more confident contingent.

Fidelity noted that several other factors may be contributing to investors’ stress: their aggregate outlook on the economy, stock market, value of real estate, and consumer and business spending.

Optimism about the 12-month outlook came in at the lowest level since the Fidelity Millionaire Outlook Confidence Index began in 2006; year over year, it fell 14 points.

Asked to assess their confidence about several personal financial factors, such as retirement savings, debt management and real estate, a significant gap emerged between average levels of confidence in the present versus the future: 68 versus 17.

Good Habits and the Advisor’s Role

The study revealed that a person’s relationship with money significantly factors into outlook and satisfaction.

The millionaires and non-millionaires who reported lower stress levels expressed more confidence in their future financial outlook and were much less worried about not meeting their financial goals, indicating a healthier relationship with their finances overall, according to the study.

They also shared several financial habits:

  • Tighter control over their spending
  • Less likely to have debt
  • More financially literate
  • Deriving more enjoyment from investing

Millionaires who reported higher levels of stress were 10 times likelier than those with lower stress to worry about paying off debts, and rated their financial knowledge and ability to manage their investments as lower than their peers.

Two-thirds of millionaires in the survey said they worked with a financial advisor, as did 63% of non-millionaires; these investors were as likely to be stressed as unstressed.

The quality of the client-advisor relationship mattered, the study said. Stressed millionaires complained more about reduced services, lack of support and greater disconnect.

Stressed millionaires ranked their advisors lower on understanding their needs, and reported feeling underserved during critical life events, the death of a loved one or sale of a home, for example.

“Advisors are working with clients at some of the most stressful times in their lives, so it’s important to address the emotions, not just the numbers,” Canter said.

“By helping to identify their clients’ underlying concerns, advisors can show the tremendous human value that an advisor provides. Combining that with a broad range of services to meet diverse and complex needs, such as offering assistance with long-term care or estate planning, can be a truly differentiating experience for a client.”

Fidelity created the Advice Value Stack to articulate how investors assign value in the advice relationship, accounting for the fact that value can mean different things to different people at different times.

At the stack’s foundation level is managing the money. Above and aligned to that is achieving goals through financial planning. On the next level up, peace of mind, which brings advisors into the realm of empathy. And at the top, fulfillment, which includes accomplishing life’s purpose and leaving a legacy.

— Check out Doctors and Advisors: More Similar Than You Think on ThinkAdvisor.


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