Reputation and credibility are the most important factors when it comes to choosing an independent financial adviser, according to a new consumer survey by YouGov on behalf of national financial advice firm Continuum.
More than one in three (37%) of 2,100 consumers surveyed said reputation was of most importance to them when choosing an adviser. Reputation was more important to women (41%) than their male counterparts (33%).
Personalised advice and quality of service were most important to 22% of those surveyed, followed by fee structure and cost (14%).
Of those surveyed, 52% had never sought advice from an independent financial adviser.
The main reason cited by those who had not sought professional advice was confidence that they could manage their finances without help (29%). Men were more confident than women with 34% of men confident they could manage without advice in comparison to 25% of women.
Over a third of men (38%) had sought advice from a professional adviser, in comparison to 37% of women.
Martin Brown, Managing Partner at Continuum, said the YouGov survey demonstrates that the financial advice profession still has work to do to improve its reputation if the advice gap is to close.
He said: “Several financial advice firms have taken steps to review and address their transparency with pricing and where appropriate make provision for compensation to customers.
“Poor actions in the market highlighted by the British Steel Pension Scheme transfer scandal have already damaged consumer confidence in financial advice firms over the past two years.
“Therefore, it is no surprise that the advice gap continues to grow. With consumers viewing reputation and credibility as the most important factor when considering taking financial advice, the sector needs to improve its public image if this gap is to close.
“The FCA is to be applauded for addressing this with the launch of the Consumer Duty, whilst at the same time the better advice firms have been putting consumer outcomes and transparent charging at the heart of what they do for years. Unfortunately, the approach by some firms has affected the perception of the sector as a whole.
“At Continuum we put our clients at the heart of everything we do, and it makes a big difference. We develop long-term relationships with our clients and their families, by not only delivering excellent consumer outcomes at a transparent price, but also by educating customers through an award-winning financial education programme plus offering our clients a loyalty programme.
“The effect this has can be demonstrated best by our Net Promoter Scores, the latest of these customer surveys in February 2024 delivered a score of +91”
The survey also suggested that there is room for financial advice brands to take a prominent position within the market, with 58% of consumers surveyed having never heard of any major financial advice brands.
YouGov surveyed 2,100 UK consumers over the age of 18 between 26 and 29 January 2024.
