The affordable advice gap, where people are willing to pay for financial advice but think it is too expensive, is currently at a record level, new research has found.
Online financial advice service, OpenMoney, has revealed that an estimated six million people in the UK would now pay for advice if it cost less, a figure up from 5.3 million people last year.
The research, based on findings among more than 2,000 UK adults, looked into why some people are willing to take financial advice, and why others are not. It found that among people who have not paid for advice in the last two years and would be unlikely to do so in the future, women are more conscious about the cost than men, with 20% saying they would be willing to pay for advice if it cost less, compared to 14% of men.
Young people were found to be the least concerned about cost, with just 11% of 18 to 24-year-olds identifying it as an issue, compared to 20% of those aged between 35 and 44.
Although cost remains a significant concern, OpenMoney suggested that trust and value are more important when it comes to encouraging people to pay for advice.
One in three (33%) respondents who would be unlikely to consider paying for financial advice, having also not done so in the past two years, said they would need to be convinced that advice would save them money. A further third (32%) would need to be sure they could trust the advice.
“Although the affordable advice gap has increased, our research found that trust and value are far more important than cost to both genders and all ages,” commented OpenMoney co-founder, Anthony Morrow. “People want to be convinced that taking advice will make a difference to their finances and save them money overall.
“Trust has long been an issue in the advice sector: memories of a sales and commission driven culture at some firms and an over-reliance on complex products and jargon have damaged people’s view of all advisers. Restoring people’s faith in the benefits of financial advice is therefore crucial to closing the advice gaps.”
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