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Browsing Research and publications by Subject "Financial planning"
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Item Open Access Disclosure effectiveness in the financial planning industry(Emerald, 2021) Richards, Daniel; Safari, MaryamScandals in the Australian financial services industry highlights the conflicts of interest between those who provide financial advice (financial planners) and their clients. Disclosure is a potential governance tool to manage these conflicts of interest by reducing asymmetries in information. Yet, the efficacy of disclosure is questionable as scandals persist, so we research the effectiveness of disclosure in financial planning. This research used a qualitative approach involving the triangulation of data from parliamentary inquiries in financial services with data collected in semi-structured interviews with financial planning professionals. The findings draw a clear portrayal of the disclosure requirements and illustrate how disclosure processes are onerous and complex. Starting with detangling the complex interactions between the beneficial role of disclosure in reducing information asymmetry and unethical behaviour and the detrimental effect of information overload, we then highlight effective disclosure techniques utilised by financial planners, including visualisation of material information. Our study reveals that financial planners perceive their role as filtering information for clients and ensuring clients’ comprehension, due to the onerous disclosure requirements. The study is of interest to researchers, practitioners, policymakers, and society as it implies that how disclosure occurs is as important as what information is disclosed. Those who wish to foster effective disclosure in the financial services industry need to consider the quantity, quality, and process of disclosure. A limitation is our research focuses on financial planning practices and not client outcomes, which could be considered in future research. The study adds to the understanding of how disclosure is utilized as a governance tool, and how the quantity of information may impede the effectiveness of disclosure in the financial planning industry. In addition, the study identifies and elaborates on the influential factors and best practices for enhancing the disclosure effectiveness by financial planners.Item Open Access The role of financial risk-taking attitude in personal finances and consumer satisfaction: Evidence from Australia(International Journal of Bank Marketing, 2023-03-20) Tahir, Muhammad; Richards, Daniel; Ahmed, Abdullahi DahirPurpose – Financial risk-taking attitude (FRT) plays an important role in consumers' financial decisions, thereby determining consumer well-being. Motivated by the recent research on consumer well-being, this paper explores the relationships between financial literacy, a propensity to plan (PTP), a financial risk-taking attitude (FRT), financial satisfaction, and life satisfaction. Design/methodology/approach – We use the Household, Income and Labour Dynamics in Australia (HILDA) survey to achieve the purpose of this paper. Furthermore, we use the variance-based Partial Least Square Structural Equation Modelling (PLS-SEM), also known as the PLS path modelling approach to test our proposed hypotheses empirically. Findings – We find a strong partial mediation of FRT between financial literacy and financial satisfaction. Moreover, the analyses reveal that a high PTP combined with a high FRT results in achieving high financial satisfaction, which leads to improved life satisfaction. Practical implications – Our findings show the importance of creating financial plans in accordance with risk tolerance. While increasing financial literacy is relevant, our research suggests that tools that help consumers plan and invest in appropriate risky investments will lead to better outcomes. Originality/value – Though scholarly acumen of consumer well-being is rapidly developing, little remains known regarding the collective roles of financial literacy, a PTP, and FRT. We address this gap by showing that financial literacy, risk-taking attitudes, and planning propensities are all interconnected and necessary ingredients to improve financial and life satisfaction.