Nearly half of investors say advisers don't help set goals, J.D. Power report

TORONTO – A new survey suggests that nearly half of Canadian investors aren’t receiving basic goal-setting advice from the advisers they’re paying.

The J.D. Power report found that 46 per cent of full-service Canadian investors say their adviser didn’t help them set goals based on their risk tolerance.

Of those surveyed, 66 per cent also said their adviser didn’t deliver on what the study identified as the three broad stages of goals-based investing: setting personal goals, implementing a strategy to achieve those goals, and monitoring progress.

Mike Foy, director of the wealth management practice at J.D. Power, said the results do not speak well for the industry.

“Forty-six per cent of investors said that their adviser didn’t meet what we call Stage One of the goals-approach, which is helping set goals and assessing risk tolerance,” he said.

“If you’re not doing that, the question is what are you doing.”

Investors are set to start receiving more information regarding the fees they pay investment advisers under changes known as CRM2 that came into force earlier this year.

The changes come as Foy says advisers are facing growing competition from robo-advisers, which can offer a lower-cost alternative.

The J.D. Power report was based on an online survey conducted in May and June that included 5,159 investors who use advice-based investment services from financial institutions in Canada.

The polling industry’s professional body, the Marketing Research and Intelligence Association, says online surveys cannot be assigned a margin of error because they do not randomly sample the population.