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Ben Stark is a chartered financial planner with over a decade of experience advising businesses and families. He is partnered with St. James's Place Wealth Management.
Taboos around vulnerability hold half of us back from asking for support when we need it most.
More than one in two of us will face situations of increased financial vulnerability in our lives. Yet, according to Chapter 4 of SJP’s Real Life Advice Report, more than half of us shy away from asking our financial advisers for support when we’re struggling.
Would you turn to your financial adviser for guidance or support if you found yourself in difficult circumstances?
It could be a bereavement, or unexpected redundancy, or an accident meaning we‘re off work for a while, or even a physical or mental condition we were born with. Whatever the reason, 1 in 2 of us will find ourselves facing vulnerable circumstances at some point in our lives.
The latest chapter of SJP’s landmark consumer survey, The Real Life Advice Report, reveals that less than half of us turn to our financial advisers to help us work through a period of increased vulnerability even though 1 in 4 of those same respondents said that financial advice had helped them feel less vulnerable in challenging circumstances.
Our Report surveyed over 12,000 adults on their attitudes and personal experiences of dealing with periods of financial vulnerability. This Chapter makes five key recommendations on how we can raise awareness of the characteristics of vulnerability and improve support across our industry.
Key findings
- More than half of us will face periods of vulnerability in our lives.
- Almost a third (31%) of those receiving ongoing financial advice sought support due to circumstances known to increase financial vulnerability
- 52% of people have never thought about discussing additional support or needs with their financial adviser.
- One in four (25%) say ongoing advice has helped them feel less vulnerable.
What do we mean by ‘vulnerability’?
Two and a half million people across the UK first seek out professional advice as a result of a major life event or change.
A change to the status quo doesn’t always mean a challenge. But in this Chapter of the Real Life Advice Report, we see that traumatic events such as bereavement, divorce, or a serious illness in the family, or dealing with a lifelong medical or mental health condition can impair our decision making and knock our confidence. All of which can increase our risk of financial vulnerability.
Yet over half of those surveyed (52%) said they wouldn’t reach out to their financial adviser.
“A lack of awareness of the support available and reticence to start conversations is causing ‘vulnerable clients’ to suffer,” said Anna Blake, Chair of the Vulnerable Clients Steering Group, St James’s Place.
Breaking down taboos around financial vulnerability
Although there is a growing awareness within the financial services industry of the challenges surrounding vulnerability, our Report uncovers a disturbing lack of awareness of the support available amongst consumers themselves.
Only one in four (23%) of those receiving ongoing advice say they were offered additional help and support when they needed it. And 15% felt they were simply re-directed towards charities of similar organisations.
“Vulnerability is a hard word to walk towards,” says the author of Chapter 4, Anna Blake, Chair of the Vulnerable Clients Steering Group, St James’s Place. “Our Real Life Advice Report indicates that more than half of people who have received some form of financial advice would be unlikely to discuss additional support needs.
“People can be reluctant to disclose vulnerabilities because they worry that it will negatively impact how they are perceived, or how they’re treated.”
“Advice can be a force for good.”
The Report calls on the financial services industry to help bridge the vulnerability advice gap by working together, detailing SJP’s ongoing strategy and support in this vital area. Increased training, sharing best practice with other leading financial advice providers and national awareness campaigns are all areas being targeted.
Anna says she’s seen a three-fold increase in the number of clients being identified as having characteristics of vulnerability since July 2020. “As an industry we need to get better at communicating that value and come together to address our gaps and champion our strengths,” she says.
“If we do so, we have an opportunity to make a real difference and demonstrate more clearly how advice is a force for good in supporting all clients at risk of vulnerability.”
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 Report – 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.
Chapter 5 of SJP’s Real Life Advice Report: Advice Priorities will look at where the nation is likely to look for financial advice in the future, and specifically the main concerns for the next six months. It's due for release on 28 November 2024.
And you can read previous chapters of The Real Life Advice Report here which covers:
Chapter 1: Why advice matters
Chapter 2: The advice journey
Chapter 3: The advice relationship
Quotas and post-weighting were applied to the sample to make the dataset representative of the UK adult population.
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.
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