- Nearly nine-in-ten investors say their financial advisor has
helped them remain confident in this period of rising inflation and
market volatility
- Millennials are significantly more comfortable with the highs
and lows of the financial markets than Generation X (Gen X) and
Boomers
- Generation X is least likely to work with an advisor
State Street Global Advisors, the asset management business of
State Street Corporation (NYSE: STT), today announced the findings
of its Inflation Impact Survey: Advisor Edition. The survey found
among those currently working with a financial advisor, the vast
majority say their advisors’ insight and guidance is valued even
more today and has helped them remain confident during this period
of rising inflation and market volatility.
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A third of investors agree that now is a
good time to invest more in the market. (State Street Global
Advisors' Inflation Impact Survey; June/July 2022)
The release of this advisor-related data follows the initial
findings of State Street Global Advisors’ Inflation Impact Survey
which found inflation-induced stress and anxiety is influencing
investor behavior when it comes to short-term budgeting and
committing to long-term financial goals. It also analyzed the value
provided by financial advisors during a period of heightened
volatility and uncertainty.
“The top two questions advisors are hearing from their clients
today are, ‘Is now a good time to invest?’ and ‘How can I protect
my portfolio against inflation,’” said Allison Bonds, head of
Private Wealth Management at State Street Global Advisors.
The survey revealed that among those working with a financial
advisor, about three-quarters have discussed inflation with their
advisor, including how inflation will impact their investment goals
in both the short and long-term. Furthermore, nine-in-ten say they
value their financial advisors’ knowledge and guidance even more in
these uncertain times, and 86% believe their advisor has helped
them remain confident in this period of rising inflation and market
volatility.
Is It Better to Work with a Financial Advisor? Sandwich
Generation Unsure
Overall, approximately half of investors (49%) agree that it’s
better to work with a financial advisor when there is volatility in
the market.
When examining the generational differences in attitudes about
working with an advisor, Gen X respondents were the least likely to
work with an advisor in today’s volatile markets. Only 42% agreed
it is better to have the guidance of an advisor compared to 63% of
Millennials.
State Street Global Advisors Benchmark Survey1 provides
additional insight as to why Gen X balks at the idea of using a
financial advisor. It revealed the top two reasons are 1) they
prefer to have full control over their investment decisions (46%),
and 2) they don’t trust that financial advisors have their best
interest in mind (41%).
Gen X’ers are the most concerned with rising inflation, with 88%
reporting that inflation is a top concern. Given the majority are
also concerned about their ability to afford retirement and staying
the course with their current investment strategy, now could be an
opportune time for this generation to be more proactive about
seeking help from a financial professional.
“Advisors have an opportunity to cultivate trusting,
collaborative relationships with Gen X clients who want to remain
involved in making their own investment decisions to a greater
extent than other generations,” said Bonds. “Gen X’ers are in their
peak earning years and in the accumulation phase of their financial
planning, yet they are also juggling multiple financial priorities.
This generation is currently sandwiched between taking care of
their children and aging parents. Gen X is more likely to have
children under 18 in the household, so discretionary spending can
become stretched if they are also supporting aging parents.”
Investor Tolerance for Market Volatility
A comparison of prior years’ comfort levels with market
volatility shows that the market’s ups and downs are making
investors more queasy. When asked how much they agree with the
statement, ‘I am comfortable with the highs and lows of the
financial markets,’ just 31% are in agreement, which is
significantly lower than a year ago (51%), and about the same as
the height of the pandemic (33%) in 2020.
Millennials are the standout, with 49% saying they are
comfortable with the volatility, compared to 22% of Gen X’ers and
24% of Boomers.
“Millennials possess a glass half-full mentality when it comes
to their financial futures. They know they have a longer time
horizon to ride out the downturns and inflationary pressures.
Sixty-three percent are optimistic they will reach their financial
goals despite record inflation, whereas most investors in other
generations believe inflation is an obstacle to meeting their
objectives,” said Bonds.
Is Now a Good Time to Invest More in The Market?
There also seems to be some ambivalence about whether now is a
good time to put more money to work in the market, with one-third
(33%) of investors agreeing that now is a good time to invest more
in the market; 36% neither agreeing or disagreeing and 25%
disagreeing.
Not surprisingly, Millennials (47%) are significantly more
likely to think it’s a good time to invest than Gen X (34%) and
Boomers (24%).
“The old adage about investment success being about time in the
market, not timing the market rings true today,” added Bonds.
“Advisors who use a goals-based approach can help clients who are
vulnerable to overreacting when markets take a downturn. This
approach can help clients remain confident about their financial
plan even in volatile markets.”
State Street Global Advisors’ Educational Content
For more on State Street Global Advisors’ point of view on how
advisors can help clients remain confident during uncertain times,
read Market Volatility: A Relationship-Building Opportunity for
Financial Advisors.
Appreciating the True Value of Advice offers insights for
individual investors on how to find the right financial
advisor.
State Street Global Advisors’ list of 4 Things Investors Can Do
in Volatile Markets provides insight for investors seeking ways to
hedge their portfolio in today’s uncertain economic
environment.
Market Volatility’s Back: Get In and Out With Liquid ETFs
discusses the importance of liquidity in volatile markets.
For more on SPDR’s point of view on the market, economy and
inflation read our 2022 Mid-Year Outlook and 5 Burning Questions
Give Investors Insight: Durable Rebound or More Pain to Come?
SPDR’s Uncommon Sense provides contrarian perspectives from
Michael Arone, Chief Investment Strategist for the US SPDR®
business, that encourage investors to think beyond consensus
opinion to identify and capitalize on new opportunities.
For more on SPDR’s take on inflation and the Federal Reserve,
read The Federal Reserve Will Declare a Premature Victory Over
Inflation.
For more educational tools and resources on ETFs, click
here.
To learn about how investors are using low-cost ETFs to achieve
a variety of investment objectives, read Build a Low-Cost Core
Portfolio with SPDR ETFs.
About State Street Global Advisors’ Inflation Impact
Survey
State Street Global Advisors, in partnership with A2Bplanning
and our field partner, Prodege, conducted an online survey among a
nationally representative sample of adults. Data was collected from
June 28 – July 5, 2022. For our Custom “Inflation Impact Survey,”
we analyzed 243 adults with Investable Assets (IA) of $250K or
more. Nearly half of those are currently working with a financial
advisor.
About SPDR Exchange Traded Funds
SPDR ETFs are a comprehensive family spanning an array of
international and domestic asset classes. The funds provide
investors with the flexibility to select investments that are
aligned to their investment strategy. For more information, visit
www.ssga.com.
About State Street Global Advisors
For four decades, State Street Global Advisors has served the
world’s governments, institutions and financial advisors. With a
rigorous, risk-aware approach built on research, analysis and
market-tested experience, we build from a breadth of index and
active strategies to create cost-effective solutions. As stewards,
we help portfolio companies see that what is fair for people and
sustainable for the planet can deliver long-term performance. And,
as pioneers in index, ETF, and ESG investing, we are always
inventing new ways to invest. As a result, we have become the
world’s fourth-largest asset manager* with US $3.48 trillion† under
our care.
*Pensions & Investments Research Center, as of 12/31/21.
†This figure is presented as June 30, 2022 and includes
approximately $66.43 billion of assets with respect to SPDR
products for which State Street Global Advisors Funds Distributors,
LLC (SSGA FD) acts solely as the marketing agent. SSGA FD and State
Street Global Advisors are affiliated.
1 State Street Global Advisors Individual Investors 2019 Study.
A global survey on consumer sentiment, purpose and behavior in
wealth management.
Important Risk Disclosures
The information provided does not constitute investment advice
and it should not be relied on as such. It should not be considered
a solicitation to buy or an offer to sell a security. It does not
take into account any investor's particular investment objectives,
strategies, tax status or investment horizon. You should consult
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Investing involves risk, including the risk of loss of
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This communication is not intended to be an investment
recommendation or investment advice and should not be relied upon
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ETFs trade like stocks, are subject to investment risk,
fluctuate in market value and may trade at prices above or below
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While the shares of ETFs are tradable on secondary markets, they
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Distributor: State Street Global Advisors Funds
Distributors, LLC, member FINRA, SIPC, an indirect wholly owned
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State Street Global Advisors, 1 Iron Street, Boston, MA
02210-1641.
© 2022 State Street Corporation.
All Rights Reserved.
4864608.1.1.AM.RTL Exp. Date: 01/31/2023
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Deborah Heindel +1 617 662 9927 DHEINDEL@StateStreet.com
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