ATLANTA/DENVER-The love of money may be the root of all evil, says the Bible, but love it or hate it, Americans are struggling with just how to deal with it. Separate studies by the Certified Financial Board of Standards and the Financial Planning Association reveal some insights to Americans' feeling about money and their sense of financial well being. The CFP Board found that more than two in five upper-income Americans worry about their future financial outlook. (The category of "upper-income" is defined as American households with an average income of $50,000.) Those that feel best about what is to come are the ones who have consulted a financial planner. They feel more in control. The CFP Board's Consumer Survey and the FPA's Value of Advice Study found that consumers fell into three categories based on how they felt about managing their finances: * Worriers- Some 43% of consumers are "worriers," and they fret about financial decisions. Despite that discomfit, and the admission that they don't understand the complex issues surrounding the financial marketplace, they do not consult an advisor. They may have a financial plan, but don't really follow it. They are under 40 and usually act as their own financial advisors. They tend to place their assets in savings vehicles like CDs and money market accounts. * Independents- This 33% segment is spread across all age groups and are mostly males. They are typically confident, considering themselves to be better at making financial decisions than other friends and family. But like the worriers, they share an affinity for lower risk investments. They do favor stocks, bonds and mutual funds, but direct a bigger chuck of capital to the "safer bets." They use the Internet and prefer to make decisions without professional help, and consequently, spend more time each month thinking about financial matters. * Help Wanteds- This 25% segment of Americans are middle-aged and older and have a higher net worth. They acknowledge that they need help navigating in the sea of finance and so enthusiastically seek professional help. They tend to have a written financial plan and stick to it. Because they seek advice, they are more likely to hold higher risk investments. They are also satisfied with the results they get. The FPA's study indicated that Americans that consulted financial planners felt close to achieving their goals. Half of the respondents reported that their relationship with such planners lasted more than five years. And they recommend the planner to other friends and family. (FPA based its survey findings on 1,000 randomly selected adults who had used the services of a financial planner. The CFP Board Survey was based on a pre-screened panel of 897 households grouped into three age-groups and categories: up-and-coming, 20-39; mid-life, 40-54; and retirement cusp, 55-69.) -
caburger@cutimes.com
