Annie Claire Zhang, a researcher at AUT, has written a paper called Financial Advice and Asset Allocation of Individual Investors, soon to be published in the Pacific Accounting Review.

In it, she analyses how New Zealanders use financial advice on their KiwiSaver accounts by looking at 400,000 individual KiwiSaver members.

Ten per cent received advice from an AFA, which she said was low by international standards but in line with what had historically been seen in New Zealand.

Her data did not differentiate between bank-provided advice and that received from independent financial advisers. “I can’t tell if they sought the advice or if someone from the bank called and said your balance is X, it’s time to think about this.”

She found through her research that female investors, older investors and those with more invested were most likely to have received advice. “That prompts the question, why aren’t men those relatively younger investors or with less funds under management getting it?”

The probability of receiving advice jumped up when balances were between $20,000 and $30,000.

She also found that those who receive advice tended to hold riskier assets than non-advised investors, less cash and bond assets and more property and equity asset classes.

Men who receive advice invest more in riskier assets, she said. Men who receive advice hold 49% of their asset allocation in equity assets compared with only 42% for men who do not receive advice.

Women who receive financial advice also invest in riskier assets than do women who have not received advice (47% in equity investment compared to 41% in equity investment, respectively), however, women hold marginally safer assets than men.

Zhang said although older investors who received advice tended to hold riskier assets than their peers who did not receive advice, they still held fewer equities and property investments than younger investors. “They must also be switching out of riskier asset classes at ages closer to retirement.”

She said there was no clear indication that advised accounts performed better, although the data available is limited to the relatively small number of years that KiwiSaver has been operating.

“During the global financial crisis in 2008, advised accounts underperformed advised accounts by 2.52%. This finding, however, is unsurprising owing to the fact that advised accounts tend to hold more equity assets than non-advised accounts.”