Earlier this month we conducted a survey of more than 2000 people across the country. Our aim was to take the temperature of the UK at the end of a year like no other, and to understand current attitudes to financial advice.
A constant for us throughout 2020 has been our commitment to servicing our clients and to continuing to move forward as a business. The survey is our way of understanding the areas we need to focus on as a firm and as an industry to keep making progress and exceeding our clients’ expectations.
The results threw up a number of interesting findings. After we crunched the numbers, we found that at the heart of the data there was a contradiction.
On the one hand, across the country three quarters of people still don’t have an adviser and don’t identify themselves with needing one. On the other hand, large numbers of respondents acknowledged they needed to know more about key areas of finance, many had fears about their finances and others could point to financial regrets.
Clearly, the obligation for us in the industry is to demonstrate more convincingly that the way to increase financial knowledge and to minimise financial regret and anxiety is to take some financial advice. We are the solution but we are still seen by large parts of the population as part of the scary world of finance that they feel excluded from or don’t identify with.
How can we change this? The findings point to an obvious area of focus. Respondents said their biggest financial regrets were not saving sufficiently or starting a pension early enough. When it came to financial fears, many worried they would not be able to retire when they wanted or had concerns about their mortgage.
These are all common, everyday issues that affect large parts of the population, and all very much the bread and butter of a financial adviser. As such, demonstrating the practical and positive impact financial advice can have and the peace of mind it can bring should be a key aim for all of us the advice industry in the years ahead.
There were also positive signs that the benefits of financial advice are being recognised and that the service we provide is in demand. When respondents were asked who they would turn to for financial advice, advisers were the top answer, followed by the bank, a partner and even some who admitted they would turn to Google.
In a sign of the uncertain economic times we are living through, the survey also found that people are nearly 20% less confident about their financial future than they were before the pandemic. The nation’s need for advice right now is coming through loud and clear.
In a positive sign for the future, the survey showed how young people are leading the way when it comes to seeking out financial advice. Of the respondents with an adviser, the largest proportion (41%) comes from the 18-34-year-old age group. This is a cause for optimism but not for resting on laurels. We need to build on this so that choosing a financial adviser becomes a natural step in life and second nature to the younger generation.
One way we can do this is through education. When it comes to educating the next generation on financial matters, nearly a third of respondents believed that this should be the job of schools.
The government definitely has a role to play in helping to raise levels of financial education and literacy but at the same time, we in the industry need to shoulder our share of the responsibility. We can have an instant impact on levels of financial education by providing the resources to help people learn.
There is already a significant amount of information on the Progeny website Advice Hub but we are planning to systematically and significantly increase this over the course of 2021 to help raise education levels on the fundamentals of finance.
We also asked respondents about their plans for intergenerational gifting and transfer of wealth. Of the parents in the survey, 58% reported that they were either currently helping or expecting to help their children financially in future.
When those of the senior age groups were asked about their financial plans, more than a quarter said they planned to give money to their children, 13% were aiming to give it to their grandchildren and 20% said they would continue to build their estate for their family to inherit.
What was clear from the survey data was when it comes to financial planning we are still a nation that very much cares about our loved ones and focuses on giving those in the next generation a helping hand.
In summary, it’s up to us in the financial advice industry to come together to continue to show the positives and the real value of financial advice to all age groups, now and in the future. This survey is just a small part of this effort but it’s a step in the right direction if we are serious about making financial advice more accessible to more people and part of the everyday lives of the population.
If you would like some help with any expect of your financial planning, please get in touch.
Progeny’s survey has been featured in a number of media outlets including:
- CEO, Neil Moles, spoke to Jazz FM‘s Business Breakfast about the results of the Progeny survey on financial advice.
- Financial Planning Today: Under 34s leading the way for seeking advice
- Money Marketing: Younger generation ‘most likely’ to seek financial advice
- Professional Adviser: Younger people more likely to have an adviser but ‘gap’ persists
- FT Adviser: Young lead the way on advice but gap continues
- Share Talk Ltd: Interview with Neil Moles, CEO of Progeny
- Daily Express: Middle class tax raid as Rishi Sunak’s inflation changes set to cost retirees over £100bn
- Leeds Live: People across the UK are 20% less confident in their financial future