Financial advice makes you happier: AFA

©iStockphoto/Alonzo Adams

PEOPLE who have a financial plan are happier about their finances and don't mind paying for the planning involved, research shows.

Consumers with financial advisers highly value the advice and are happy to pay for it, research commissioned by the Association of Financial Advisers (AFA) has found.

The study found that those who seek advice are significantly happier with the manageability, diversification and return of their current investments than those who are unadvised.

AFA chief executive Richard Klipin said consumers ranked financial advisers as the third most trusted profession after medical specialists and dentists.

"The research findings very clearly demonstrate that consumers who have an advice relationship are better planned and happier with their investments than those that don't," he said on Wednesday.

"They look on their adviser as a coach helping them along the path to financial freedom and therefore have greater peace of mind."

Mr Klipin said the research indicated the federal government had misread what issues mattered most to people seeking financial advice.

"The government with its fixation on adviser remuneration appears to have blinkered vision around the real issues, which is Australians need financial advice and are better off when they receive it," he said.

Sweeping changes to financial adviser remuneration were introduced on July 1.

The changes force advisers to explicitly charge for advice, rather than including their payment within commission structures.