The fees millennials are willing to pay are considerably lower than the industry average of £150 per hour, according to data from Unbiased.
Only 15% of so-called generation A, those in their late teens and early 20s who have spent most of their working lives under the shadow of austerity, said they would spend more than £30 per hour.
Just 5% were willing to pay more the £50, with 51% of generation A respondents saying they would not pay for advice at all.
Young focus
However, 22% said they would choose a financial adviser if they offered a young person’s discount, with 12% open to choosing an adviser or advice firm that focused solely on giving advice to millennials or employed young advisers.
Demonstrating value
Sophie Robson, consultant at MRM and author of the research, said: “In today’s world, £28.50 buys very little. Other professionals, such as solicitors, can easily charge up to £1,500 for services associated with moving house for instance, but people accept these costs because they understand the risks involved in going it alone.
“Financial advisers on the other hand really have their work cut out to demonstrate their value to young people.
“Many people will baulk at the thought of spending £150 per hour on advice, but over the long-term, this initial outlay could translate into savings of hundreds, if not thousands of pounds, as well as having the comfort of a qualified professional easing the burden of juggling your personal finances.
“If financial advisers can get this message across, it would go a long way to helping people get financially fit,” Robson said.
Simpler robo-option won’t cut it
Lawrence Cook, director of marketing and business development at Thesis Asset Management, said: “It is only when there is more at stake – and the risks of not taking advice could mean making some very costly mistakes – that people are liable to see the value of financial advice.
“The more complicated a person’s financial life, the more likely they are to understand that advice should be tailored specifically to their own circumstances and objectives – the simpler robo-option is probably not going to cut it anymore. And that is the point at which advisers need to demonstrate that their services represent good value for money.”
Trusted relationships
Jun Merrett, content editor at Nucleus, said: “This is the perfect opportunity for advisers to engage with the younger generation to offer low-cost, light touch online services at a minimal time and financial cost to themselves that help young savers with their relatively simple financial needs.
“This helps form trusted relationships and will ‘incubate’ the young savers as clients until they hit the point where they have sufficient assets that need full financial advice; valuable for both client and adviser.”
