The Benefits of Financial Advice

 

This Is Money summed up many a dilemma, stating: “There will be times in your life when you’re not sure what to do with your money or what decisions you need to make to protect your financial future. Trouble is many people can be unsure about the quality of advice on offer or whether advisers have their best interests at heart, while others are sceptical of whether it’s worth paying for advice.”

Nevertheless, it concluded: “In the long run, a good financial adviser will justify their fee by making you a wealthier individual than if you opted to go it alone.”

However, is there a further dimension?

New research from Royal London claims “professional advice delivers so much more to customers than the expected financial benefits”.

Adding: “It also helps to improve their emotional wellbeing by making them feel better about themselves and their finances – especially in times of crisis.”

 

Around three in five (63 per cent) who received advice said they felt financially secure and stable compared to just half (48 per cent) who had not received advice. Four in 10 (41 per cent) who had not received advice felt anxious about household finances compared to just a third (32 per cent) of those who were advised.

Tom Dunbar, Royal London intermediary distribution director, said: “We have long suspected that the benefits of advice go far beyond financial gains alone and our research confirms that individuals who have received advice are more likely to feel confident about the future, and less likely to feel anxious or worried.

“It’s easy to see why clients turned to financial advisers when the pandemic struck. But advice is most powerful – and most rewarding – when it goes beyond a one-off meeting. An ongoing relationship with an adviser amplifies the emotional, as well as the financial, benefits.

Liz Field, chief executive of PIMFA, the trade association that represents financial advisers and wealth managers, commented: “Many people believe that financial advice is out of their reach, or that it won’t make a material difference to their lives while also finding financial matters daunting or a cause of anxiety. There is a proven direct correlation between a person’s financial and mental wellbeing.

“At a time when many people will be worried about their financial future, getting professional financial advice is vital and we welcome research such as this that so effectively illustrates how advice can affect real help for people in their everyday lives.”