Comprehensive Advisors vs. Modular Advisors: A Study of Household Financial Assets During the Great Recession

16 Pages Posted: 20 Sep 2018

See all articles by Aman Sunder

Aman Sunder

College for Financial Planning

Lance Palmer

University of Georgia

Joseph W. Goetz

University of Georgia

Swarn Chatterjee

University of Georgia

Date Written: September 11, 2018

Abstract

This study intends to investigate the extent and dynamics of financial advisory services, and their relationship to changes in the different financial assets held by households’ in the United States, before and after the Great Recession, using the 2007-2009 panel of Survey of Consumer Finances (2009). The panel survey was conducted in two waves among the same households, before the Great Recession in 2007-08, and after the recovery started in 2009-10. The study found that the rejection of comprehensive advisers after the recession was associated with a significant reduction in total financial assets. Retention of comprehensive advisors was associated with a significant increase in mutual funds, but also increase in bonds. Retention of modular advisors was associated with a significant decrease in IRA/Thrift account values and increase in bonds. Obtaining new modular advisors after the recession led to lower liquid assets, and higher bonds in a recovering market. Rejection of modular advisors also led to higher bonds. The study also presents the implications for financial planners.

Keywords: Financial planners, CFP®, Great Recession, Financial Behavior

Suggested Citation

Sunder, Aman and Palmer, Lance and Goetz, Joseph W. and Chatterjee, Swarn, Comprehensive Advisors vs. Modular Advisors: A Study of Household Financial Assets During the Great Recession (September 11, 2018). 2019 Academic Research Colloquium for Financial Planning and Related Disciplines. Available at SSRN: https://ssrn.com/abstract=3248063 or http://dx.doi.org/10.2139/ssrn.3248063

Aman Sunder (Contact Author)

College for Financial Planning ( email )

9000 E. Nichols Ave
STE 200
Centennial, CO 80112
United States
7853176604 (Phone)

Lance Palmer

University of Georgia ( email )

United States

Joseph W. Goetz

University of Georgia ( email )

Athens, GA 30602-6254
United States

Swarn Chatterjee

University of Georgia ( email )

Athens, GA 30602-3622
United States

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