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FPG Says Poll: Financial Services & Investments

We polled a random, national sample of just over 650 males and females, ages 25+, on the topic of financial services and investments.  The poll surveyed respondents on financial account types and products owned, trading habits, and brokerage firm usage.

For analysis and reporting purposes, age data has been divided into the following groups: age 25-34, 35-44, 45-54, 55-64, 65-74, and 75+.  The response rate is greatest among those between the ages of 35-74, with 59% of respondents falling within this age range.

Respondents were first asked to tell us what types of financial accounts they currently have.  The response options were presented as follows:

  1. Savings Account
  2. Checking Account
  3. Certificates of Deposit (e.g. CDs – not including IRA CDs)
  4. Online investment / brokerage account you manage on your own, not including any employer sponsored retirement accounts (TD Ameritrade, Fidelity, Charles Schwab, E*TRADE, Scottrade, Merrill Edge, etc.)
  5. Individual Retirement Account (e.g. IRA or Roth IRA)
  6. Employer sponsored investment / brokerage account specifically setup to manage your current and/or previous company’s stock bonus plan (i.e. stock options, restricted stock, performance awards, employee stock purchase plan)
  7. Employer-sponsored Retirement Account (e.g. 401(k) or 403(b))
  8. College savings plan (e.g. 529 plan or Coverdell)
  9. None of the above

Nearly all (99%) respondents report having a checking account and 89% report having a savings account.   Only 1% of respondents report not having any of the listed types of financial accounts.

  • Retirement savings accounts are owned by well over 50% of respondents. Individual retirement accounts (IRAs) are held by 63% and employer-sponsored retirement accounts are held by 57%.
  • 48% report having an online investment / brokerage account they manage on their own.
  • The less commonly-owned account types are certificates of deposit (25%), employer-sponsored investment / brokerage accounts (22%), and college savings plans (15%).

Female respondents are more likely to have employer-sponsored investment / brokerage accounts and/or employer-sponsored retirement accounts than men.  However, men are more likely than women to have every other type of financial account listed.

We then asked respondents to tell us about the types of securities owned in their portfolios.  A simple definition of a security is any proof of ownership or debt that has been assigned a value and may be sold.  For the holder, a security represents an investment as an owner, creditor or rights to ownership on which the person hopes to gain profit (“What Are Securities (in Finance)? – TheStreet Definition”).  Respondents were asked specifically about the following types of securities:

  1. Stocks
  2. Bonds
  3. Mutual Funds
  4. Exchange-traded funds (ETFs)
  5. Options

Stocks and mutual funds are the most represented securities among respondent portfolios at 57% and 50%, respectively.  Almost 20% report that none of the listed securities are part of their portfolios or say that they have “other” securities in their portfolios.  Examples of the “other” securities, as reported by respondents, are gold coins, cryptocurrency, deferred compensation, annuities, and real estate investment trusts (REITs).

With the exception of stocks and mutual funds, men are more likely by nearly 50% or more to have the listed securities in their portfolios than women.

Those between the ages of 55-64 report having more stocks and bonds than any other age group.  Ages 45-54 have more mutual funds, while those ages 65-74 are most likely to have “other” securities.

The majority (56.8%) of respondents are not personally executing trades without the assistance of an investment professional.  A trade refers to the transaction of buying or selling a stock, ETF, mutual fund, option, or futures contract.  Among those respondents personally executing trades, most (41%) are only making 1-2 trades a quarter.  The number of those personally executing quarterly trades decreases steadily as the range of trades made per quarter increases.  The exception is those that make 30+ trades a quarter, which is 50% more than those that make 20-29 trades a quarter.

54.4% of respondents are not using their brokerage firm’s desktop/web application to execute trades, and 37% make all or most of their trades using their brokerage firm’s desktop/web application. 9% prefer to use their brokerage firm’s mobile application, but will sometimes use the desktop/web application.

Men and those between the ages of 35-44 are most likely to make all or most trades via their brokers’ desktop/web application or mobile application.

Consumers have a large selection of brokerage firms to service their accounts.  There are five major stock brokerage houses in the United States, often referred to as the “big five brokerages.”  Each of these firms, Scottrade, Charles Schwab, Fidelity Investments, E-Trade and TD Ameritrade, comprise the top five in terms of customers and assets (Ross 2017).

The firm most represented by our respondents is Fidelity Investments (24%), followed by Charles Schwab, TD Ameritrade, Vanguard and E*TRADE.  24% do not currently have brokerage accounts with any of the listed choices.  Firms such as Edward Jones, LPL Financial, Raymond James, TIAA-CREF, UBS, T Rowe Price, Nationwide, Stifel Nicolaus and Robin Hood, are most mentioned among the “other” firms.

“What Are Securities (in Finance)? – TheStreet Definition.” TheStreet, TheStreet, www.thestreet.com/topic/47042/securities.html.

Ross, Sean. “The Biggest Stock Brokerage Firms in the US (SCHW, ETFC).” Investopedia, Investopedia, 14 Aug. 2017, www.investopedia.com/articles/professionals/110415/biggest-stock-brokerage-firms-us.asp.

By Ann Ali