Nearly 34% or 340,000 clients out of a million who took financial advice since 2008 don’t see the value in paying for that advice, according to a report by research firm GfK.
However, IFAs’ expectations suggest that just 14% or 140,000 investors would ditch financial advice in favour of dealing with a provider directly, a gap of 20% between clients’ and advisers’ perceptions.
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In terms of purchase route, 67% of people who have used an IFA in the last five years would prefer to go direct to the provider. Some 52% prefer to use the company website, 18% would contact them using the telephone and only 10% of clients would choose to buy their investments through a platform or fund supermarket.
Martin Grimwood, GfK divisional director for life, pensions and investments, said: "Many of those people who plan to go direct are the next generation of serious investors. They are accumulating their wealth now and should be the perfect audience for the support and advice of an adviser."
Of 1.6 million active investors in Great Britain who have taken out an equity investment – not including pensions – in the last five years, one million people took professional advice to purchase the product.
GfK interviewed a cross section of over 400 intermediaries, including Panacea community members, in June 2013 about RDR. The results were compared to the findings from active market investors from a second source – the GfK Financial Research Survey (FRS) – that researches 60,000 consumers over the course of a year about financial services.
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By GlobalDataThe profiles of those likely to invest in the next 12 months who have used advice in the past, and who said they would now "never consider paid-for advice", span all sizes of investment portfolio, with 37% of investors with less than £50,000 in liquid assets and 20% of investors with £100k+ in liquid assets.
Two thirds – 67% – said they would prefer to go direct to the provider with over half of these – 52% – choosing the company website, 18% telephone and 10% a platform/fund supermarket as their path to purchase.
