Who Seeks Financial Advice?

Abstract

Using the 2012 National Financial Capability Study, this paper shows that income, risk tolerance, and financial literacy are related positively to the demand for financial advice and more greatly affect the probability of seeking advice than do other variables. A low perception of financial knowledge and financial fragility decrease the probability of seeking certain types of financial advice. People who lack confidence in their financial knowledge, who struggle with their expenses, and are not able to save for retirement or emergency needs might not have the luxury to think about investment or tax planning.

Keywords: Financial Advice; Risk Tolerance; Financial Knowledge; Financial Literacy; Financial Fragility

JEL Classification: D14; G20