An actuarial examination of eight case studies showed $1.7 million in collective financial value was unlocked by obtaining and acting on financial advice. In most cases the advice also led to immediate savings, the Financial Planning Association said today.

At the launch of its new Value of Advice Research, FPA Chief Executive Officer, Jo-Anne Bloch said "A financial planner can help consumers understand the benefits and risks of investing, relative to their particular situation and longer-term financial goals, which is critical during times of market volatility like we have experienced recently".

Rice Warner Actuaries Director, Michael Rice, said his examination of the non-financial benefits of advice were clearly valued by clients.

The non-financial benefits of advice included:

• Increased savings through more planned cash and debt management;
• Improved lifestyle stability arising from appropriate insurance coverage, securing ownership of a home, and obtaining appropriate support from government agencies for disabled dependents;
• Enhanced life opportunity due to more focused business management, return to work strategies, lifestyle instability reduction, and acquisition of lifestyle assets; and
• Helping people to understand their situation, navigate the financial market place and gain control of their finances.

"We found that obtaining financial advice on a single issue can lead to changes in savings behaviour, such as setting proper budgets or following a plan for paying off debt, which is often the first step to organising finances and building wealth," said Mr Rice. "It was clear that limited advice provided good value for the time and cost involved, and goes a long way to delivering significant benefits to more Australians".

Ms Bloch said the actuarial research clearly shows how advice can greatly enhance financial well-being, although as many as 4 out of 5 Australians have not yet taken the step of seeking financial advice*.

The FPA commissioned Rice Warner Actuaries to develop the evidence-based quantification of the Value of Advice using 12 case studies provided by the FPA 2006 and 2007 Value of Advice Award winners.

*FPA Consumer Attitudes to Financial Planning study 2007.

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