Misconceptions about the role of advisers could have serious repercussions for the financial services industry, as a significant number of consumers believe they have little need for independent advice.
Independent research commissioned by Intelligent Finance found that: ‘38% of UK consumers do not anticipate consulting a financial adviser in the future.’ However, the results were not uniform and the findings varied by region, with 46% of those in Scotland and 43% of those in Wales and the South West stating they had no plans to use financial advisers in the future. When giving reasons for this most said that they thought advisers were only used by the rich or well-off.
Ian Jeffery, sales and service director at Intelligent Finance, said: ‘While this will make grim reading for anyone in the industry, it should be viewed as an opportunity rather than a threat. The research indicates that a large percentage of the target audience sees no need for their services. This percentage of the population is, therefore, an untapped marketplace that could be persuaded on the merits of financial advice, and the challenge is to reverse those opinions.’
However, there was some positive news, 72% said they could see value in consulting an adviser when buying a house. Commenting on this, Nick Baxter, director of Mortgage Promotions, said: ‘Brokers have got to take it upon themselves to show they add value. I do not think that statutory regulation will help increase consumers’ confidence in brokers, as a proportion of consumers will always think they can get the best deal themselves just by visiting the high street.’