More high net-worth Americans are inclined to rely on financial advisers since the Sept. 11 terrorist attacks, according to a new survey from The Phoenix Companies.
In late September, 24% of the well-heeled individuals with a household net-worth of at least $1 million excluding the primary home said that they saw an increased need to rely on professional advisers for financial guidance. In June, 16% surveyed said they needed help.
Financial planner F. Dennis De Stefano attributes the increased need for advisers on the plunging stock market, which started its descent in the spring of 2000. He said reality has struck for many investors who based their expectations on the 90s bull market. "I think Sept. 11 accelerated that (notion)," said the founder of De Stefano Wealth Management in Kihei, Maui, Hawaii.
Despite rising fear, the wealthy remain optimistic about the nations economy. Nearly 70% said they remained optimistic about the future of the economy in late September, about one percentage point higher than their response in June. Although the high net-worth crowd continues to feel financially comfortable (94%), 28% said they are delaying big-ticket purchases and vacations. In June, 19% answered similarly.
When asked about their feelings toward the future of the economy, 52% said the worst is over. In all, 32% said the worst is yet to come but the country will recover.
Financial planner Nancy Frank of New York isnt quite as upbeat. The upper-East Side resident has a large portion of her clientele in the media industry, which has been laying off employees and closing publications to temper the market downturn. "I dont get a feeling its going to turn around fast," she said. "Its a gut feeling."
De Stefano believes the terrorist attacks have pushed back the economic recovery from the current quarter to the second half of 2002. On the flip side, Frank isnt offering her clients any thoughts about a sustained rally. "If I had a crystal ball, Id give them the day, date and time," she said.
The Phoenix Companies, based in Hartford, Conn., surveyed 1,013 investors online in June and followed up the survey Sept. 26-Oct. 3 from a sample of 370 original participants.