No financial resolve

How's this for a New Year's downer: Most of us are as likely to keep our resolutions about improving our financial health (such as boosting IRA contributions or cutting up credit cards) as we are about losing weight or exercising. “We make all these resolutions with respect to financial health, such as saving more, investing better and diversifying — but few of us actually follow it unless we are guided by professionals we trust,” said Indiana University business professor Utpal Bhattacharya. Most people won't even take free financial advice when it's offered. A study of 8,000 German customers of Charles Schwab & Co. Inc. found that only 5% accepted the firm's offer of algorithm-driven recommendations designed to improve portfolio efficiency, said Mr. Bhattacharya, who co-authored the study with professors from Goethe University of Frankfurt. Most of those who took the advice were male, older, wealthier, had longer relationships with the brokerage firm and had portfolios that already had performed well, he said. Even so, of the 5% who agreed to receive the advice, not many actually followed it — a shame because those who did enjoyed better performance, Mr. Bhattacharya said. “We found ourselves with a modern, financial version of a horse we'd led to water, but couldn't make drink,” he said.