UK millennials more likely to embrace robo-advice, says Legg Mason

Added 12th April 2016

UK millennials are more open to receiving financial advice from automated services, so-called robo-advice, than their counterparts around the world, a survey by global asset manager Legg Mason has revealed.

UK millennials more likely to embrace robo-advice, says Legg Mason

According to the firm’s Global Investment Study, which polled more than 1,000 investors aged between 18 and 39, young UK investors are the keenest globally on online automated advice services.

In total, 85% of UK youngsters surveyed said they were comfortable with robo-advice, while 80% said they would trust their advice – a figure much higher than those polled around the world except for US millennials where 82% said they would trust the advice of automated services.

On average, 59% of the younger generation around the world expressed comfort with robo-advice, with 63% trusting it.

Meanwhile, 70% of European millennials were comfortable with robo-advice, with 65% trusting it.

Overall, professional financial advisers scored more highly among UK millennials with 91% feeling comfortable with their financial adviser and 88% having trust in them.  

The findings show the extent to which robo-advice is taking off among the younger generation.

Adam Gent, head of UK sales at Legg Mason Global Asset Management, said: “Robo-advice remains a relatively new concept in the UK compared to the US, where it is more established, but the levels of support for this new advice channel suggests it is far more than a passing fad.

“Indeed, with such trust being placed in online advice by younger investors, many of whom will have grown up with the internet, it would appear the future looks bright for robo-advisers as they seek to establish footholds in the UK advice market.”

In an earlier release from the same survey, Legg Mason said more investors trust the media on investment than robo-advice services despite the rising numbers of start-ups and established companies entering the online space.

Global robo-advice reguilation grows

The news comes just weeks after a number of financial services regulators from around the world announced plans to introduce guidance designed to regulate the emerging robo-advice industry.

Last month, the Australian Securities and Investments Commission (Asic) released a draft of its proposed guidance on providing digital financial product advice services to retail clients, while Singapore’s Financial Services Commission (FSC) announced it was looking to introduce legislation allowing robot advisory services to provide direct advice to customers.

In addition, the UK’s Financial Conduct Authority (FCA) announced last week that it will set up a specialist 'advice unit' to deal with robo-advice firms - in line with recommendations made in the Financial Advice Market Review (FAMR) in March.

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Monira Matin

Senior Reporter

Monira joined International Adviser in March 2016 from Informa Global Markets where she worked as a eurobond reporter for over two years, covering fixed income markets. She has previously held a number of editorial positions covering politics, insurance and technology. Monira has a degree in Journalism and Economics from City University.

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