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I was stunned as I left my recent meeting with Natixis Global Asset Management, an investment firm thatJonG - professional2011 oversees more than $800 billion globally. Yes, the last 18 months have been frustrating for investors as markets have whipsawed up and down. However, this nor their outlook for the markets going forward were the reason. Instead, I realized just how bad of a job we as financial professionals are doing at educating individual investors and at the same time, how individuals are failing themselves when it comes to their finances.

Natixis spends a lot of time researching and studying individual investors. In their recent poll of thousands of individuals, the conclusions were sobering:

  • Over 50% of investors have no financial plan nor financial goals.
  • 83% rely on gut instincts to make investment decisions.
  • US investors believe they need a 10.1% return above inflation to meet goals. Yet:
    – Over 80% would choose safety over performance.
    – 75% are conflicted between preserving capital vs. pursuing returns.

What I hear from this is that most investors have no idea of how to achieve their financial goals and want 12-15% returns with minimal risk. Good luck! However, since they are relying on gut instinct, behavior will dictate investment decisions which is a recipe for disaster. Studies show that the average individual investor’s portfolio barely earns enough to keep up with inflation. This is due to bad investment decisions.

As a financial professional with over 20 years in the investment management area, this study made me cringe. I realize as an industry we need to step up our efforts to educate investors and to help individuals achieve their goals. I congratulate our clients for seeking out help. While we cannot control the markets, we do provide answers on the most pressing questions including the one that is most critical, “Am I going to be alright?” I am proud of the work we do for our clients but there are still millions of people that can benefit from working with a holistic financial planning firm.

*All statistics are from Natixis Global Asset Management, 2015 Global Survey of Individual Investors: Close Enough Isn’t Good Enough
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As Chief Investment Officer for Planning Solutions Group, Jon provides innovative investment planning strategies to our clients. He has over 15 years of experience in the financial services industry. Prior to joining Planning Solutions Group, Jon worked in the institutional market place. He provided investment advice to a client base consisting of large asset management and mutual fund companies, state retirement funds and hedge funds. His experience in the institutional market included Vice President of Institutional Sales for Deutsche Bank in Baltimore and Chicago. Prior to this, Jon worked as a research analyst for Croft-Leominster, an investment advisory firm in Baltimore. His focus was analyzing and recommending securities for inclusion in client portfolios. Jon is a Chartered Financial Analyst (CFA) charterholder. He has been recognized as a Five Star Wealth Manager, featured in Baltimore Magazine. He is also NASD Series 7 and 63 registered. Jon graduated from the Johns Hopkins University where he majored in economics. He lives in Towson, MD with his wife & two sons. To email Jon: