Our life savings, our pension, how we support ourselves are huge fundamental decisions and impact all aspects of our lives. And yet, *research from the Financial Conduct Authority, believes there are 18.2 million people who have £10,000 or more in savings &/or investments that might have a need for financial advice but haven’t taken it.
But if we need financial advice, why don't we ask for it?
Is it because as a nation we generally don’t like discussing money? Are we put off by the myths that surround advice – for example you ‘have to be rich’, ‘it’s too expensive’, ‘it’s not worth it? If you have ever thought any of these things, ask yourself if these thoughts are based on facts or ’just what people say’?
There are probably many factors that put people off getting advice but given that we all need money to support ourselves and you could potentially be much better off with advice from the experts – is it at least worth exploring?
Does financial advice really make a difference?
There's lots of research to show that advice works, adding real value to people’s financial circumstances in the long run.
We are generally not programmed to think long term, it can be hard enough budgeting each month, let alone looking 15-20 years into the future. And then having to work out how much money you’ll need to maintain your lifestyle and how you achieve that. So back to the opening line - we seek experts for important decisions as that’s their job - to have the knowledge that we don’t.
27,664 reasons to get financial advice
A study by **ILC UK shows just what a positive difference advice can make. It also shows that advice is for everyone and not just the ‘rich’.
The research looked at two groups of people to see if they were better off with or without advice. The first group were ‘affluent’ and the second group considered themselves as ‘just getting by’.
The study was carried out over a number of years to get an extensive view of people's finances and measure the impact longer term. Those who took financial advice in both groups ended up with an average increase in their pension wealth of £27,664 than those that didn’t take advice.
As we all know, nothing is certain. As with any investment, even with an experts' help, the value can go down as well as up and you may not get back the amount you put in.
* August 2018
** The research explored the impact of financial advice between 2001-2007 on financial outcomes in 2012-2014. Due to the fact this study was carried out over such a long period, it is the latest data available.