Research from AXA has highlighted that people tend to use three different sources when looking for financial advice. Financial advisers topped the list, with 43 per cent identifying them as a key source, 42 per cent used the internet, and information provided by banks, savings and investment providers was the choice of 30 per cent.
The research also found that pensions and retirement planning was number one on the list of the top 10 things advisers are asked by clients.
Discussing this research, Peter Selby, Managing Director, Retail Advice for Punter Southall Aspire, says: “The need for face-to-face advice looks to accelerate over the next decade, with particular demand for pensions and retirement advice.”
“The introduction of pension freedoms in 2015 gave people greater access to their pension fund and has made the need for financial advice at retirement even more essential. Around a third of people over 55 currently don’t seek any advice when they drawdown their pension, they simply ask for their money from their provider.
“Unfortunately, many people end up paying tax on three-quarters of it, without considering their other options. For most people, their pension fund will be the biggest lump sum of money they will ever have had. Speaking with a qualified financial adviser to ensure they are making the most of the money they’ve worked so hard to save is a very sensible option.”
“One misconception that needs to be overcome is that financial advice is expensive, and advisers are untrustworthy. Getting over this challenge will become even more important as the pension market matures, with more people having built up significant pension pots. Otherwise, the only person that is going to benefit is the tax man.”
A recent survey of Financial Times readers highlighted that clients value the three T’s when it comes to appointing a financial adviser – transparency, trust and tailored advice. Selby says: “Total cost transparency is no longer an issue due to new European MiFID II regulations introduced earlier this year.”
“These regulations raise transparency standards and to comply, financial advisers and product providers must be absolutely clear over fees and costs. This should help build trust – something which is increasing as the reputation of financial advisers improves due to regulatory and compliance rules imposed by the FCA.”
“Over the next ten years, we expect more people will seek tailor-made financial advice, alongside guidance they find online or from their provider. With auto-enrolment and more people building up large pension funds, having the right advice may help ensure a better outcome for their future and avoid them having to pay too much tax.”
“Punter Southall Aspire has recently acquired two independent financial advisory firms and added eight regulated financial advisers to our team, with more to follow in 2019. We can assist individuals at all stages, but particularly at retirement; to help people make the most out of their pensions and investments, as well as helping employers engage their workforce with pension saving with our consultancy and online financial education tools and support,” he says.