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HNWs shifting away from advisers

An increasing proportion of high-net-worth individuals expect to dispense with the services of advisers and run their own portfolios, a major new survey reveals.

Fifty-eight per cent of millionaires use IFAs at present but only 49 per cent expect to be using them in five years time as increasing numbers take control of their own financial affairs, according to the research from IBM.

Twenty per cent of millionaires are self-reliant for advice and that number could rise to 37 per cent in five years.

Sixty-three per cent of wealthy individuals, with average net investable assets of £300,000, use IFAs at present, but the research shows that figure could fall to 55 per cent in five years.

The report, Achieving Success in the Wealth Management Market, was compiled by market research group Tru-Est, based on interviews with 1,534 wealthy individuals.

It shows that the growth of media coverage of business and financial affairs and the ease of access to information through the internet is increasingly persuading wealthy individuals that they can run their finances themselves.

The report shows that 30 per cent of millionaires cited newspaper financial pages as their most important and influential source of advice, compared with only 19 per cent citing IFAs.

Tru-Est chairman James Anderson says: “The proliferation of press and web-based information relating to personal finance means clients are in a much better position to interrogate the adviser. Firms must adopt a more sophisticated approach articulating to clients where they have added value.”

Manor House Financial Services manager Anne Clayton says: “The problem is if individuals make their own portfolio decisions they have to take responsibility if it goes wrong. If they take advice they have some comeback.”


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