The ‘Face-to-Zoom’ Future of Financial Advice:
You’d be forgiven for thinking that the pandemic has been financially bad all around. Yet, as with any crisis, there have been winners as well as losers. In previous posts, we have seen how good the pandemic has been to the tech giants. We have witnessed first-hand how well our clients have adapted to their (often, first!) foray into online meetings. So too, we have taken a look at what this might mean for financial planning in days to come. But, what does it all mean on an individual level – for those to whom ‘face-to-Zoom’ financial advice will be the norm?
Well, as we look back over the last 12 months, financially they have been undeniably good for some people. We’re not referring to the billionaires who’ve been on a rollercoaster ride of oscillating share values over the last year. Rather, we’re talking about the many, many people who have ‘accidentally’ saved money in commuter fares, from not buying lunch and, of course, foregoing their annual holidays. Granted, there is a pay-off in the savings. No one wanted to go without their holiday – but depending on which paper you read, people in the UK have saved anywhere between £100bn and £125bn during lockdown!
A Tale of Two Halves
As alluded to in our introduction, any crisis is a tale of two halves. And, at the opposite end of the spectrum, lockdown has been spectacularly hard for those people whose businesses have failed. We only need to look to LinkedIn to see the multiple posts from highly talented individuals seeking employment to realise that if we have not been directly impacted ourselves, we all know someone who has been. Naturally, when you have no income coming in, you are forced to rely on your savings – so the flip side of the coin comes full circle.
Irrespective of which financial situation (good or bad) your finances fall into, both need careful financial planning. Before the pandemic, it seemed that fewer people might need financial advice – every day brought with it news of a new money management or savings and investing app at the touch of your fingertips.
However, a recent report from Prudential indicates that the exact opposite is true. 53% of UK adults say that financial problems and changed circumstances over the last year have seen them look for financial advice. Of this number, 33% have already actively sought financial advice, while the remaining 20% plan to do so imminently.
For most respondents, 85% of people said they had concerns about the next twelve months. Furthermore, the two primary concerns included: ‘having to use savings to make ends meet’ and ‘my investments losing money.’
The Future of Financial Advice
This is where it gets really interesting. Prudential’s report revealed that the need for financial advice was felt most pressing among Millennials and Generation Z. These are exactly the generations we might have assumed would shun traditional advice in favour of apps and online portals.
Seventy-four per cent of Millennials said that they had, or were going to, see a financial adviser. 58% of Generation Z echoed those sentiments. The key drivers included ‘avoiding financial difficulties’ and ‘wanting to start [their] investment journey.’
Clearly, the last 12 months have been challenging for everyone. What they have illustrated is that financial planning advice will always be required and that people – of whatever generation – will always value face-to-face advice (even if that has been face-to-Zoom financial advice recently…)
Our clients can rest assured that whatever happens with the pandemic – and however long the restrictions stay in force – our commitment to providing the very best long-term financial planning advice will never waiver.
Written by Alex Welsh
Alex is a Resolution-accredited, Chartered financial adviser. Having joined the firm in 2012, he has extensive knowledge of all areas of financial planning.