One in five UK adults ‘too proud or embarrassed’ to seek financial advice
Almost one in five (17%) of non-advised customers are either too proud or embarrassed to talk to someone about how to manage their finances, according to new research published by pensions giant Royal London.
The firm, which is the UK’s largest mutual life and pensions provider gathered views from over 4,000 customers and has identified six common barriers that stand in the way of people accessing financial advice.
The survey found that 47% of respondents thought seeking financial advice would be too expensive, however, four in ten revealed that they did not know what an adviser charged.
More than one in three (35%) of non-advised customers believe advisers can’t offer them anything that they can’t do themselves. However, this contrasts with previous Royal London research which shows advised customers not only feel more informed, they are also financially better off by more than £47,000 over a ten-year period than their non-advised peers.
A further 15% of non-advised customers feel their finances are either too simple or that advisers are only interested in customers who are wealthier than them. However, 31% of this group have more than £50k in investable household assets and so could benefit from speaking to a financial adviser.
The survey found that 29% of respondents feel they can’t trust an adviser – or they don’t know how to find a good one. However, 27% said they would be likely to see an adviser once they had been given more information about the services on offer.
Almost a quarter (22%) of customers have never sought professional financial advice because they simply haven’t considered it as being something they might need.
Commenting on the research, Jamie Jenkins, Royal London’s director of policy and external affairs, said: “The advice gap is undoubtedly one of the biggest issues we face as a nation when it comes to people getting their finances in order. This is particularly the case over the last year when so many people have faced a multitude of challenges in their lives.
“While some people are unable to access advice, this research shows there are potentially more than nine million others who could be seeking professional financial advice who aren’t. This is often down to misconceptions around cost and misunderstanding around what they can expect from an adviser.
“As long as these misconceptions exist these people are missing the opportunity to build a sustainable financial plan that safeguards their present and future. As an industry we must look at how we can break down these misconceptions as well as helping advisers to scale up their business so they can offer support to more people.”