At a glance
- To meet their needs, financial advice must be more flexible, accessible and relevant in the future.
- When people experience financial advice, they benefit financially, but also have a stronger sense of financial security and mental wellbeing.
- SJP is calling for action to help break down the barriers preventing more people from accessing financial advice.
The Real Life Advice Report Chapter 6: A new generation of advice
The younger generation and financial advice. More of them want it, more of them can see the benefit of it – but still many hold back from seeking it. The final chapter of SJP’s Real Life Advice Report – our landmark survey into consumer attitudes towards financial advice – concludes that advice for younger generations must be more flexible, more accessible via social media channels – and more relevant than ever before.
31% of Gen Z (18-34 year-olds) have already used financial advice to help with specific areas such as mortgages, managing budgets, even getting married.1 That’s more than ever before – and more than any other age group. One in four (24%) are seeking ongoing professional support compared to 11% of 35-54 year olds and 12% of those aged over 55.1
More young people seeking advice
For Millennials (35 – 44) and Gen Z (18 – 34), finacial planning is becoming more critical — and more complex — than ever before.
These generations are buying their first homes later, shouldering greater financial responsibility for their own retirement income, and if they do inherit, it may be much later in life. They could be retired themselves by the time they inherit a lump sum.
That’s creating unprecedented pressure for younger generations, who are looking to form advice relationships with people more like themselves.
Breaking down barriers and taboos around advice
But overall the survey concludes that of those not using financial advice or guidance, only one in five (18%) of Gen Z think they would find it beneficial in the future. That’s despite strong recommendations from friends, family and online influencers – often their go-to sources for trusted recommendations.
Mark FitzPatrick, CEO of St. James’s Place, comments: “Whilst it’s good news that more young people are seeking professional financial support, our report equally shows that too many simply feel that that ‘financial advice is not for them’ or aren’t aware of how it can help. It’s critical that we continue to raise further awareness and break down the barriers preventing people from accessing the advice or guidance that can help them. Having support to navigate life’s uncertainties and point you in the right direction can be life changing.”
What does the future of financial advice look like?
The evolution of the financial landscape for younger generations presents both challenges and opportunities for the financial advice sector.
Choosing advisers we can relate to help close the ‘advice gap’ means attracting and training a new generation of financial advisers. The average age of financial advisers in the UK are in their mid-50s, but at SJP it’s 46.2 And 23% of our Partners are female, versus an industry average of 16%.3
St. James’s place’s Financial Advice Academy rains up to 500 new advisers every year. And over half our graduates come from non-financial backgrounds, bringing fresh perspectives and diversity to the industry as a whole.
These new financial advisers are themselves part of the younger generation. They can relate more easily and help advise more effectively.
Attracting and training a generation of younger advisers so that people in need of financial advice can look to us and see people they can relate to is a vital part of that. People with similar experiences and reference points, people that can engage with younger clients on channels they feel most comfortable on, and people who will understand their financial pressures and goals.
We must come together as an industry and do more to illustrate how advice can make a tangible difference and extend our outreach to those who feel that advice “isn’t for them”. Education and awareness are key to this.
What is the Real Life Advice Report?
Opinium surveyed just under 12,000 UK adults nationwide in two polls between May and August 2024 on behalf of SJP. The survey – our largest consumer survey to date – is based on interviews and real life stories exploring the value of financial advice, our attitudes surrounding it, and its future.
You can read Chapters one – five of The Real Life Advice Report here.
We’re here to help
The right financial advice with a trusted adviser can help you build strong foundations for the future; both for yourself and for your loved ones, too. Get in touch today.
Past performance is not indicative of future performance.
The value of a St. James’s Place investment will be directly linked to the performance of the funds you select and the value can, therefore, go down as well as up. You may get back less than you invested.
We have looked at the impact of all forms of financial advice and guidance. From professional advice received through a financial advice firm or individual including a wealth manager, an Independent Financial Adviser (IFA), a qualified financial planner, and advice received through a bank and building society. We have also looked more broadly at understanding the impact of the help people receive through organisations such as Citizen’s Advice, Pension Wise and others.
Sources
1The Real Life Advice Report was commissioned by St. James’s Place. Opinium surveyed just under 12,000 UK adults nationwide in two polls between May and August 2024. Quotas and post-weighting were applied to the sample to make the dataset representative of the UK adult population. Quantitative data referenced is sourced from the first poll which had a total sample of 7,995 respondents. Survey included those aged 18-34 (1,940), aged 35-54 (2,654) & aged 55 and over (3,401).
2 Unbiased.co.uk, July 2024
3 Personal Finance Society, December 2023
SJP Approved 04/12/2024