We all know that we should really be seeking financial advice, particularly if we're saving for retirement, but relatively few people actually take the plunge and speak to an adviser. So what's stopping you? According to research from Old Mutual Wealth and Intrinsic, a lot of it comes down to cost.
The research found that the perceived cost of financial advice is the main factor discouraging people from seeing an adviser, with 37% of respondents citing this as the key barrier. This is perhaps unsurprising when 44% said that they wouldn't want to pay any kind of fee for advice, while 33% said they weren't sure how much they'd be willing to pay, and 15% said that they'd pay up to £250.
There were other barriers too, but many of them still had a financial basis. For example, 33% said they didn't think they had enough wealth for an adviser to help them, while 31% feared paying for something they didn't need, and 15% weren't convinced that an adviser could offer value.
Other factors included the fear that advisers would be biased towards some products (30%), being unsure which advisers to trust (19%), and it being hard to know which adviser would give them what they needed (16%). In fact, only 20% said that they saw no barriers preventing them from speaking to an adviser, meaning a large proportion of consumers could be left financially vulnerable.
Improvement on the cards?
Given that so many potential barriers are there, it's welcome news that the Government has launched a consultation on consumer access to financial advice, with a special focus on helping those with "limited wealth".
The consultation will explore what can be done to improve customers' access to financial advice, and will involve determining the kind of financial advice consumers want, asking whether there are gaps between this advice and the kind they can access and afford, and looking for ways to close those gaps.
Hopefully, it could result in the market providing more accessible and affordable financial advice when people need it, but in the meantime, you don't have to go it alone – and you probably won't want to. "To many people, paying for advice can feel like a fee to shelter themselves from tomorrow's problems," said Intrinsic chief executive Richard Freeman.
"As a result, some put-off taking advice or choose not to take it altogether. However, advice allows people to plan a sustainable retirement income strategy and protect their family if they become unwell or unable to support them," he concluded, and it's for these reasons that you really should consider seeking suitable advice.
It needn't cost a fortune but it could make all the difference to your family's long-term financial security, so don't be put off – start researching to find an adviser in your area (or consult Pension Wise if you're approaching retirement and want a free, impartial guidance service) and see if you can crash through some of those barriers.
Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.
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