As many as eight out of ten investors preparing for retirement have consulted a financial advisor at least once. This is not about to change. It has never gone higher, despite the rapid growth of Internet trading. What has happened is that the Internet has allowed investors to take a more active role in making investment decisions. There is an interesting concept in psychology called the illusion of control.
People feel that if they re doing something, they re in control.
What we are finding is that many investors want to combine the hands-on use of the Internet with personalized advice. This is reflected in the recent announcements from Prudential Securities and Merrill Lynch that they are creating accounts that will allow clients to buy and sell mutual funds and stocks over the Internet. Other full-service securities firms have said they are studying the idea. These firms simply are responding to the multiple needs of their clients. Some investors want to be more involved but still want to rely on personalized guidance from a financial advisor.