Unbiased Financial Advice About Retirement Is Important to Older Adults

Many adults today save for retirement in individual retirement savings accounts such as 401(k) plans provided through their employer. Throughout their life, they face decisions such as whether to keep change their savings investments or move them. Many seek advice from financial professionals to help them with these retirement planning decisions.

On October 31, 2023, the U.S. Department of Labor announced a new rule concerning professional financial advice related to retirement savings accounts, such as 401(k) plans and IRAs. The proposal would clarify the circumstances during which financial advice related to retirement plans must be in an account holder’s best interest.

In December 2023, AARP conducted a nationally representative survey of adults ages 50-plus to determine how many adults expect professional financial advice to be in their best interest and how many believe that this should in fact be required.

The survey reveals that adults ages 50-plus use the advice they receive to make important financial decisions, and they not only expect that professional financial advice will be in their best interest but also believe that this should in fact be required.

The survey’s key findings are detailed below:

Many rely on financial professionals for retirement planning.

• Nearly four in ten (38%) adults ages 50-plus have already used a financial professional to help plan for retirement, and roughly three in ten (29%) expect to use a financial professional for this purpose within the next five years. 
• Among those who have never used a financial professional to help plan for retirement, the most common barriers are: prefer to handle it myself (41%); don’t have much retirement savings (35%); don’t think I can afford a financial professional (30%); and don’t know if I can trust financial professionals (20%).

Most expect financial advice to be in their best interest, yet uncertainty about the rules persists.

• Of those who have either already used a financial professional for retirement planning or expect to use one, roughly nine in ten (89%) say that they expect professional financial advice to be in their best interest, and a similarly large share (87%) say that they use professional financial advice to make important financial decisions.
• However, despite the widespread expectation that financial advice will be in their best interest, many of those who have used a financial professional for help with retirement planning (43%) admit that they actually don’t know whether the most recent professional they used was required to give them advice in their best interest.

Most agree that financial professionals should be required to give advice in the best interest of account holders.

• Nine in ten (90%) adults ages 50-plus agree that, when giving investment advice to people with retirement savings accounts, financial professionals should be required to give advice in the best interest of the account holders.
• In fact, two-thirds (66%) of adults ages 50-plus say that they would be less likely to vote for their member of Congress if they were to overturn a rule requiring financial professionals to provide advice in the best interest of their clients.

Methodology 

Interviews were conducted December 7–11, 2023, among 1,002 U.S. adults ages 50-plus in the Foresight 50+ Omnibus. Funded and operated by NORC at the University of Chicago, Foresight 50+ is a probability-based panel designed to be representative of the U.S. household population ages 50 or older. Interviews were conducted online and via telephone. All data are weighted by age, sex, education, race/ethnicity, region, and AARP membership.

For more information, please contact S. Kathi Brown of AARP Research at skbrown@aarp.org.  For media inquiries, contact media@aarp.org.