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FAs Feel Good About the Economy

November 11, 2013

Brinker Capital’s colorful third-quarter “barometer” of financial advisor sentiment paints a mostly positive picture as the year enters its final month.

According to the company’s survey of 255 FAs, 49% feel good about the U.S. economy, almost twice the number of respondents during the same period in 2012. Apparently, last year’s “fiscal cliff” spooked advisors more than this year’s debt crisis and government shutdown have. And over two-thirds of survey respondents said their clients are in better financial shape than they were a year ago.

Nevertheless, 72% said “market skepticism” still keeps prospects from heeding financial experts’ advice. Furthermore, nearly a third said potential clients would rather do their own Internet-based financial planning and investing than pay a professional. That may be why 69% of respondents told Brinker they’re planning to pay more attention to clients’ “personal or purpose-driven outcomes” in the future.

As for the investment hot-and-not list, 57% of survey participants said they’ll be allocating more client assets to alternatives; 46% plan to move more money into international vehicles; and 54% are more bullish on equities. Clearly mindful of interest-rate risk, 63% will be taking assets out of fixed income, and 14% will allocate less to emerging markets. But only 28% say they intend to keep less money in cash.

On a macro level, a majority of advisors expressed concern about Washington’s ability to guide the country and safeguard its international reputation. And 68% remain fearful that regulation will hamstring the financial industry during the next 10 years.

By Joan Warner