- Nearly half (46%) of investors feel confident in the advice they receive if they believe their advisers are being honest with them
- For two fifths (41%) of investors, their adviser’s familiarity with their financial situation is what gives them confidence
- Yet, despite understanding the need for financial advice, a quarter (16%) of investors do not trust advisers
In a world where the value of advice is under increased scrutiny, cost, while being important, is not the only concern for investors. Nearly half (46%) of investors say it is honesty from their financial adviser that gives them confidence in the advice they receive, according to new What Price Advice report findings from AFH Wealth Management.
For two fifths (41%) of investors, their adviser’s familiarity with their financial situation is what gives them confidence, while 37% say it’s previous performance and 36% believe it’s maintaining open lines of communication. It’s clear that investors value a personal touch when it comes to managing their investments.
Since the financial crash ten years ago, there has undoubtedly been a shift in consumer behaviour. Nearly a third (32%) of investors now recognise the value of financial advice more. However, one in eight (16%) say they don’t trust financial advisers but understand that they need them, and 12% say they are more involved in their financial decision-making because they don’t trust their advisers.
Yet the need for advisers to demonstrate good value for money is crucial as their clients are not afraid to look elsewhere. Over three quarters (77%) of investors admitted they would switch financial adviser if they felt they weren’t receiving value for money, with 16% already having done so. Just 7% of investors say they are loyal to their current adviser and only 5% think it would be too much hassle to switch.
Alan Hudson, CEO of AFH Wealth Management, commented:
“In order to demonstrate the value of proper advice, it is crucial that advisers understand exactly what investors want. Top of this list is honesty, be it about fees, charges or investment performance.
As investors become increasingly discerning with a greater propensity to switch and new advice models enter the market, the value and effectiveness of face-to-face advice will continue to be challenged. We, as an industry, must demonstrate value and give investors confidence in the actions we take and decisions we make.”