Abstract

http://ssrn.com/abstract=2434267
 


 



The Impact of Financial Advisors on the Subsequent Wealth of Older Adults


Benjamin F. Cummings


Saint Joseph's University - Department of Finance

Russell N. James III


Texas Tech University

March 15, 2014


Abstract:     
Despite the growing use of financial advisors, relatively little is known about the impact that financial advisors have on actual wealth outcomes among older adults. Using data from the Study of Assets and Health Dynamics Among the Oldest Old (AHEAD), we find that using a financial advisor is positively related to subsequent net worth, especially on net worth values more than a decade after initially reporting the use of professional financial advice. Having a financial advisor is also positively associated with current and subsequent investment returns, and a large factor impacting the difference in returns comes is due to differences in portfolio allocations. Specifically, we find evidence that the impact of a financial advisor on subsequent wealth is likely due to a greater allocation to equities.

Number of Pages in PDF File: 38

Keywords: financial advice, household finance, financial advisor, AHEAD, equity market participation

JEL Classification: D14, D31

working papers series





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Date posted: May 10, 2014  

Suggested Citation

Cummings, Benjamin F. and James, Russell N., The Impact of Financial Advisors on the Subsequent Wealth of Older Adults (March 15, 2014). Available at SSRN: http://ssrn.com/abstract=2434267 or http://dx.doi.org/10.2139/ssrn.2434267

Contact Information

Benjamin F. Cummings (Contact Author)
Saint Joseph's University - Department of Finance ( email )
Philadelphia, PA 19131
United States
Russell N. James III
Texas Tech University ( email )
2500 Broadway
Lubbock, TX 79409
United States
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