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Not enough wealth and lack of trust: Why consumers shun advice

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A third of people believe they do not have enough wealth for an adviser to help them, according to research from advice network Intrinsic.

In a July survey of 1,400 UK adults over the age of 35, the firm also found that 31 per cent feared paying for something they did not need.

And 30 per cent said they believed advisers may be biased towards certain products, while 19 per cent were unsure which advisers to trust.

Intrinsic chief executive Richard Freeman says the figures show the challenge of demonstrating the value of advice.

He says: “To many people, paying for advice can feel like a fee to shelter themselves from tomorrow’s problems. As a result, some put off taking advice or choose not to take it altogether.”

The Old Mutual owned network also found that 37 per cent cited the cost of advice as a deterrent to seeing an adviser.

And of 726 people who had never been to see an adviser, 44 per cent said they would not be prepared to pay a fee, while a further 15 per cent said they would only pay up to £249.

The findings echo a June survey from Platforum, which asked 252 active investors how much they would pay for advice, with 49 per cent stating that they would pay less than £500.

The survey comes as the Government launches its Financial Advice Market Review to assess the availability and affordability of advice.

The Treasury and the FCA published a consultation on the topic earlier this week, and will be taking evidence until 22 December.

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Comments

There are 3 comments at the moment, we would love to hear your opinion too.

  1. Although all the above points are valid it comes down to this;

    You don’t know what you don’t know – and the vast majority including the press, politicians and civil service don’t understand personal finance issues on a rounded basis. Especially the inter-reaction and impact on a persons life. Therefore what chance do the public stand?

    The public rely on PR, online and press examples and this little bit of knowledge gives the impression that they have real knowledge. Nothing could be further from the truth.

    As long as that status quo exists why pay out thousands of pounds for ………..?

    I happily pay a small fortune to my financial and legal advisers each year. Why? Because I know I don’t know all there is about a specific issue. They are the experts.

    Our education of the public, no matter how well meaning, can never teach that. Only experiences teaches you that.

  2. My goodness it does take some so called researches an age to arrive at the bleedin obvious. If you don’t have money you hardly need financial advice. The lack of trust issue is merely an excuse for not engaging. I don’t particularly trust the NHS, therefore I gladly pay for PMI. There are plenty of bent solicitors and accountants – the trick is to find the decent ones.

  3. In broad terms, there are (financially) four categories of people:-

    1. Those who have no wealth and no spare income with which to build wealth, let alone pay someone for advice on how to do so. Such people live from month to month and I cannot help them.

    2. Those who have a bit of discretionary income but who aren’t prepared to pay a few hundred quid for advice on how to go about embarking on a long term programme to build wealth with it. I really don’t care about such people.

    3. Those who have a bit of wealth and some discretionary income and who understand that paying for advice on how to make the best of it may well yield long term benefits. Such people may well come to someone like me and, in the long term, will hopefully be glad that they did so.

    4. Those who have both wealth and a fair bit of discretionary income and who understand the benefits of advice and ongoing supervision of their financial planning affairs. Such people may well already be in a long term relationship with a good financial adviser. Most established practices have plenty of people in that category.

    So what’s the problem?

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