Greetings – Mike here. Mark is up in London so I’m doing the honours today. Which is indeed fortuitous as it is time to talk Advice Gap.
Our Advice Gap research has been running in various guises for over 10 years now, stretching all the way back to the OG 2016 report from the Citizens Advice Bureau. This year’s study will be the 4th edition in full on lang cat branding glory, as usual combining YouGov consumer research with the views of our adviser research panel.
Back in 2015, 6% of the population paid for advice in some form (mortgage, protection, investment etc). This grew to 11% in 2023 (with a short blip earlier that decade for all the unpleasantness), settling down at 9% as Consumer Duty was implemented. This year 8.27% of UK Adults accessed paid for advice, compared to 8.74% last year. A slight dip, yes, but not statistically significant enough to get too excited about. One to keep an eye on though.
One thing that has changed is the emergence of a new gap – The AI advice gap. Our latest consumer research shows that 24% of UK adults have asked the robot about their personal finances, with over half of them saying they acted on what they were told. Good job these models always give accurate results. What? Oh…
Over the coming weeks we’ll really get stuck into the data with a big focus on the barriers to adopting advice. If you want to “solve” the advice gap there is no one single silver bullet, both on the consumer and adviser side of things, but one thing is clear. There is an increasingly large cohort of consumers who are “near misses” – wealthy enough where advice would be of real benefit to them, but for a combination of factors (including AI) they are choosing not to or are unable to access the help they need.
The regulator has been trying to make it easier for firms to serve a wider range of customers with different needs, with the introduction of Targeted Support and consultations for simplified advice. We’ll look at both consumer and adviser views over the coming months, however the FCA are “starting to see evidence” of a positive impact.
We keep returning to this research for one simple reason. Every day we speak with advisers and get to see the value they deliver to their clients. Those 8.27% who are fortunate enough to have taken advice get peace of mind, improvements in financial wellbeing, and through this research 96% of them say the advice was helpful. More of the population deserve to benefit from advice, and this research attempts to set out what needs to be done to make that happen. We will be releasing the findings over the coming weeks, with all the research hosted via the dedicated website at https://www.theadvicegap.co.uk/. If you want to chat through the findings, or have any views on the Advice Gap more generally, please do give me a shout.
And to close, loads of good new albums out at the moment (Ezra Collective, Bonobo, Badu, Beck etc) but as mentioned above, it’s HomeGame in a fortnight. Choose Leith…
