Aegon UK, part of Dutch-based international life insurance company Aegon, said the poll had been conducted among 2,000 UK adults in September 2015.
The survey found that just 14% of people are confident they can plan their retirement goals and invest to achieve the retirement. Yet an overwhelming 78% had not sought financial advice specifically about their pension provision.
Those surveyed were happiest to seek advice regarding making an investment in the stock market (27%), deciding how to best mitigate inheritance tax (27%) or when choosing a mortgage (26%).
However, only just over 20% of respondents said they would consider asking for advice on planning their pension goals, consolidating their pension pots or selecting a pension product.
Duncan Jarrett, managing director for retail at Aegon said the company’s survey illustrated the scale of the mountain facing the financial advice industry and the government when trying to bridge the advice gap.
Advice gap
In August the government launched a Financial Advice Market Review to examine how the industry could work better for consumers. It covers the full scope of retail products in the financial market, including pensions, savings, mortgages, and insurance.
Earlier this month the Treasury and the Financial Conduct Authority began consultations with the industry to gather their input on the growing gap between the advice consumers are prepared to pay for and what the industry can afford to provide. It will also look at whether there are any regulatory barriers facing UK advice firms.
Aegon’s Jarrett said price comparison sites had revolutionised the way people buy simple retail financial services products, with the majority happy to make decisions on products where they can compare simple features and costs. However, the difference when it comes to pension and investment decisions is very marked.
“Only a minority are confident of a DIY approach, yet only small numbers are willing to ask for help.
“This is despite the fact that 90% of people who have taken advice were happy with the service which suggests it is the cost, rather than the service which is the biggest barrier,” he said.
Jarrett said the industry needed to make a concerted effort to explain the value of advice.
“There are few easy answers when it comes to bridging the advice gap, but we expect that digital tools and the introduction of guidance services are likely to play an increasing role in supplementing the future advice landscape.”
