More widely, the stigma and anxiety many people feel when discussing money creates similar barriers to broader guidance. Too often financial advice and guidance are seen as only for the two extremes: for the very wealthy or for those in financial strife.
The reality is we all share ambitions and face complicated choices, and we can all benefit from a little help along the way.
When we make the first steps to break down the barriers to seeking help it is proven that it really does take some of that invisible weight off.
More than eight in 10 of those who have ever received some form of financial advice or guidance say it benefitted their emotional or mental wellbeing in some way (84 per cent), with around one in six (16 per cent) saying they now sleep better.
Up for review
It is clear more needs to be done to connect people with the support they could benefit from.
I believe this is where the FCA’s proposed advice guidance boundary review presents a real opportunity.
Both the targeted support and simplified advice proposals have the potential to encourage many more people to invest for their futures.
The first would enable firms to help people make their own decisions by providing clear and simple tips and information. The second could be used to provide a limited number of pre-determined outcomes to show people how they might take those all-important investing first steps, which is already working well under abridged advice.
But there are inherent risks too. Targeted support cannot feel like full advice or there is risk of consumer detriment. It should help people to make their own decisions rather than telling consumers what they should do.
Consumer protection should not be compromised while also ensuring that new opportunities are viable propositions for industry to deliver.
These are not insignificant hurdles, but I know our industry will grasp the nettle to overcome them. It is more the challenge of how quickly this can be achieved. The longer it takes the more people lose the opportunity to make better informed choices for their future.
As firms we also have to win over more hearts and minds, addressing where we have fallen short for clients and prove we are building on our strengths and have learned our own lessons.
Finally training new advisers must be a priority as the supply of advice is one of factors in the advice gap. We need to train and develop more talented professionals, with diverse backgrounds to better represent their clients’ needs – and we need more of them now, not some point in the distant future.
