Financial Advice Can Benefit Customers by £40,000Published: September 26, 2017 by Jennifer Armstrong
New research shows those customers who receive financial advice can be better off on average by £40,000.
Royal London recently sponsored a research project with the International Longevity Centre – UK (ILC-UK) to produce ‘The Value of Financial Advice’ report. This independent report demonstrates that customers who take financial advice can on average be £40,000 better off than those who don’t take advice.
The report analysed data between specific time periods across a range of different individual and household assets in Great Britain and examines the impact of financial advice on two groups. Those who are ‘affluent’ and those who are ‘just getting by’.
The ‘affluent’ group has been identified as those who are more likely to have degrees, be part of a couple and a homeowner. Whereas the ‘just getting by’, are more likely to have lower levels of educational attainment, to be single, divorced or widowed and rent a property. Here’s some of the findings from the report:
When the ‘affluent’ group received financial advice on average they accumulated:
- £12,363 (17%) more in liquid financial assets.
- £30,882 (16%) more in pension wealth.
- A total of £43,245 more,than those who were also deemed to still be affluent but didn’t receive any financial advice.
The report also identified that 6.7% of this group were more likely to save and 9.7% were more likely to invest in the equity market compared to those that didn’t receive financial advice.
Whereas, those within the ‘just getting by’ group who did received advice, on average accumulated:
- £14,036 (39%) more in liquid financial assets.
- £25,859 (29%) more in pension wealth.
- A total of £39,895 more, than those who were also in this group and didn’t receive financial advice.
And this time round 9.7% of this group were more likely to save and 10.8% were more likely to invest in the equity market that the equivalent of those who were in this group but didn’t receive any financial advice.
Here’s what Steve Webb ( Royal London Director of Policy), had to say about the report:
This powerful research shows for the first time the very real return to obtaining expert financial advice. What is most striking is that the proportionate impact is largest for those on more modest incomes. Financial advice need not be the preserve of the better off but can make a real difference to the quality of life in retirement of people on lower incomes as well. The evidence shows that when people take advice they are overwhelmingly satisfied and benefit as a result. More needs therefore to be done to overcome the barriers to advice.
There is a trend in the medical market which suggests that over 80% of people will now seek their first line of help from the internet, before they approach their doctor or a medical practitioner. This sort of trend- where the internet is the start point for information is now common place among many industries.
However, returning to the medical example, although most people now click onto Google to start with when they first have a medical concern, the number of people visiting the doctor has not gone down. The professional medical support and advice that can be accessed face to face, in the real world, remains as important as ever.
The same applies to financial services- the benefit of using a professional and qualified expert is undiminished by the explosion in online information and services.
At Medical & General Financial Solutions Ltd we can help our clients in the following ways:
- Access to expert industry knowledge – we understand how financial products work and how these products may benefit you
- Suitable solutions- we can provide you with a range of solutions which are tailored to your individual circumstances
- Research all options – let us do the hard work on your behalf. Researching financial products can take a significant amount of time and it’s often difficult to know if you’ve explored every available option. We can research the relevant products and help you make an informed decision
- Peace of mind – we’re on hand to provide advice on an ongoing basis and a ‘holistic’ financial planning service which is professional, personal and friendly at all time
In summary, whatever your current position you’ll need to use financial ‘products’ to help you along your way. These could include, pensions, tax wrappers, life assurance and home finance. These products will be available to you from many different companies (providers), they will have costs and in some case underlying funds which you will need to choose and terms and conditions that will apply, amongst other factors. The best companies for one person may be very different to the best companies for another.
An adviser at Medical & General Financial Solutions Ltd. can help you match the right products, companies and funds meet your needs, both now and in the future. Get in touch today for a free, no obligation consultation.