Specialist lawyers at Irwin Mitchell Private Wealth are warning of the dangers that come with a lack of diversity in asset management, following the recent publication of the Office of National Statistics’ Wealth and Assets survey revealing property to be the number one form of investing for the future.
The survey, published on the 27th June, detailed a sample group of under 40 respondents’ attitudes towards savings, retirement and investments. One notable statistic was that 49 per cent of respondents considered property to be the most effective way of planning for later life and making a solid return on their original investment, up 3 per cent from the previous survey’s results covering July 2014 – June 2016. Employer pension schemes remained in second place but fell in popularity from 24 per cent to 20 per cent.
Stocks and shares trailed behind in third place at 9 per cent, while premium bonds remained in final place with 1 per cent believing them to make the most of their private wealth. ISAs, savings accounts and personal pensions were also viewed as relatively ineffective when it came to saving for retirement, with single-digit percentages on the survey.
Irwin Mitchell writes that the survey’s findings reflect a trend of relying on one form of asset investment as other avenues of managing private wealth, often managed by the government, have failed to capture the imagination of the British public as trustworthy and reliable ways to both save for retirement and reap a good investment during later life.
Nick Rucker, private wealth expert and Head of the London team at Irwin Mitchell Private Wealth, says: “The Assets and Wealth Survey reflects the unwavering, even growing optimism that the public has in the housing market over other traditional forms of saving.
“However, the 2008 financial crisis should serve as a reminder that no market is ever safe. This, paired with the recent stagnation in house prices across the country, should only highlight the need to invest in multiple asset classes rather than relying on one which has traditionally been robust.
“When it comes to retirement and investing for the future, it is important to be aware of any overexposure to one asset class and maintaining a diverse portfolio of assets. While property is a perennial favourite of the British, as reflected by the ONS’ recent findings, there are several other areas of investment that will serve well for later life such as personal pensions, stocks and shares.
“Irwin Mitchell Private Wealth advises that in order to ensure a comfortable and safe retirement, clients should have a complete wealth, tax and legal plan in place in order to ensure their plans for later life come to fruition rather than placing ‘all eggs in one basket’ and risking exposure to losing wealth or assets.”