Advised Clients Are on Average £40K Better off Than Unadvised Clients
A recent study called ‘The Value of Financial Advice’ from the International Longevity Centre found that clients who received independent financial advice were better off by an average of £40,000.
Those who sought financial advice were more likely to save more money and more inclined to invest their money into the stock market.
The report looked at two groups, the ‘affluent’ and the ‘just getting by’.
The affluent and advised customers increased their liquid assets on average £12,363 more than the affluent and non-advised, and £30,882 (16%) more in pension wealth (total £43,245).
The less wealthy but advised group amassed an average of £14,036 (39%) more in liquid assets than the non-advised group and a pension wealth of £25,859 more (21%) (total £39,895).
The study looked at people who’d received financial advice between the years of 2001-2007 and re-evaluated their wealth by 2012-2014. Another finding shows 90% of people are satisfied with the advice they received, with a large majority following their advisor’s suggestions.
Financial advice is still relatively under-accessed with just 16% of people having seen an adviser between 2012-2014. The two main reasons for people looking for advice are trust in an independent advisor to give advice, and the individual’s financial competence.
The report recommends that employers should encourage employees through auto-enrolment to seek advice along with a standard level of guidance for pension savers looking to access their funds.
ILC Head of Economics of Ageing Ben Franklin says: “A high proportion of people who take out investments and pensions do not use financial advice, while only a minority of the population has seen a financial adviser.
Since advice has clear benefits for customers, it is a shame that more people do not use it. The clear challenge facing the industry, regulator and government is to get more people through the ‘front door’ in the first place.”
Speak to gpfm’s independent Chartered Financial Planner advisors today on 01992 500261 or on firstname.lastname@example.org to see how they can help you, from retirement planning and wealth management through to inheritance tax planning and later life advice.
This article is for information only and must not be considered as financial advice. We always recommend that you seek independent financial advice before making any financial decisions.