The UK advice gap shows no sign of improving, especially with the long-term effects of coronavirus, but Brits do not think advisers are worth it.
Online financial advice service OpenMoney, in conjunction with YouGov, surveyed over 2,000 UK adults and found negative perceptions could be why just 10% of Brits have taken paid-for financial advice in the last two years.
This is unchanged from 2019.
Some 79% of those who hadn’t taken advice are also unlikely to do so in the future, which is up from 77% a year earlier.
‘Money grabbing’
The findings are part of OpenMoney’s second annual advice gap report, The UK Advice Gap 2020: Are Consumer Needs For Advice And Guidance Being Met?, which takes a detailed look at the nation’s wealth, debt and the need for advice.
The research invited respondents to share what came to mind on hearing the term ‘financial advice’.
Frequent words were ‘expensive’, followed by ‘untrustworthy’, with the likes of ‘scam’, ‘con’, ‘rip-off’ and ‘money grabbing’ also prevalent.
While positive words were used by many respondents, with ‘managing money’ a common association along with ‘help’, ‘expert’ and ‘trust’, they were largely outweighed by the negatives.
The report also highlights that many people find it hard to differentiate between regulated advice and generic guidance, and there is a strong theme of distrust around the impartiality of advice and the value it provides.
Change
When asked what would need to change to encourage this group to pay for advice, 34% would need to be sure it would save them money overall.
Some 22% said they would need to earn more, while 28% would need to trust the advice.
This was followed by 18%, who would need to be sure how to pick the right advice, and 15% who need advice to cost less.
Anthony Morrow, chief executive of OpenMoney, said: “Despite the negative perceptions of financial advice, when people take specialist money advice the vast majority have a good experience.
“If the industry is to close the advice gap and help improve people’s financial futures, we first need to tackle the perception gap. All too often when people think of financial advice, they think ‘expensive’, ‘untrustworthy’ and ‘scam’.
“Changing these negative associations and promoting the positive work our industry does is crucial to ensuring that more people access regulated financial advice and make the most of their money today and for the long-term.”
