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Investor Understanding of Broker Account Statements: Findings from a Survey

by Teresa A. Keenan, Ph.D., AARP Knowledge Management, Jane Takeuchi, AARP Knowledge Management, AARP Research, January 2000

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How well are experienced investors with full-service brokerage accounts able to understand and interpret the account statements they typically receive? In general, many do not understand much of the basic information provided in such statements, and may thus not be able to fully appreciate the gains and losses occurring in their accounts.

The study also sought to determine the ease of use of such statements. Its findings suggest that

  • Broker account statements need to be simplified and written in an easy-to-read style with a minimum of financial jargon, and
  • Investors need to become more educated about the contents of broker account statements and how to interpret them.

The findings are based on telephone interviews with 314 investors conducted by NFO Research, Inc. between May and July 1999. The survey was prepared and its results interpreted by Jane Takeuchi and Teresa Keenan of AARP Research and Laura Polacheck of AARP Legislation and Public Policy. (21 pages)