Hiroshi Fujiki ワーキングペーパー一覧に戻る

  • Who Needs Guidance from a Financial Adviser? Evidence from Japan


    Using individual family household data from Japan, we find that households prefer financial institutions, family and friends, and financial experts as actual sources of financial information, and financial institutions, neutral institutions not reflecting the interests of a particular industry, and financial experts as desirable sources of financial information. We find that households choosing actual sources of financial information involving financial experts have better financial knowledge, as measured in terms of knowledge about the Deposit Insurance Corporation of Japan, than those selecting family and friends for the same purpose. These same households are also more willing to purchase high-yielding financial products entailing the possibility of a capital loss within one to two years. We also find that households choosing desirable sources of financial information involving financial experts and neutral institutions also have better financial knowledge. Conditional on the choice of financial institutions as the actual source, households that regard neutral institutions as a more desirable source tend to have better financial knowledge. However, it is unclear whether households that seek the guidance of a financial expert have higher ratios of stock and investment trusts to financial assets than those selecting family and friends as their source of financial information. 


    The prolonged period of low economic growth and interest rates that has accompanied rapid population aging in Japan over the past two decades requires ever more Japanese households to decide more carefully how much to save and where to invest. For example, many Japanese corporations have begun to implement defined contribution corporate pension plans, such that workers must take much more responsibility for their own saving. However, the Japanese flow of funds accounts show that riskier (higher yielding) assets, such as stocks or investment trusts, represent just 16% of all household financial assets as of December 2018. Observing this rapidly changing landscape for retirement savings, the Financial Services Agency (FSA) of Japan has been actively promoting investment in FSA-selected no-load and simple investment trusts, through tax exemptions on dividend and interest earnings on securities. However, it remains for households to choose from the products approved by the FSA, and they still need sufficient financial knowledge for this purpose.