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Family Office Bulletin


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75% of advisers feel it is important for family members to be involved in the equity release process due to pandemic

-Just one in five (20%) of advisers felt family members only needed to be involved in the process depending on the complexity of the case

-Just one in 20 (4%) did not believe it was important to involve family at all

New analysis of adviser sentiment on client vulnerability from equity release lender more2life  reveals parallel expectations from advisers and clients when it comes to the importance of involving families in equity release conversations.

Importance of family involvement a common theme:

Three quarters (75%) of advisers feel it is important for family members to be involved in the equity release process – especially following the impact of COVID-19.

The important role that family can play in the advice process was a common theme throughout adviser responses, with only one in five (20%) of the opinion that the need for family members to be involved depends on the complexity of the case, and only one in 20 (4%) believed it was not important for family members to be involved at all.

Barriers to family involvement falling:

When asked why some clients would opt not to include their families in the decision-making process, almost one in three advisers (29%) reported that not wanting to worry their families was a key consideration for clients, down from 34% in 2020. For clients that are understood to be vulnerable, this decreases to only 7%, demonstrating the effect of the advice sector’s efforts in raising awareness about the benefits of support for vulnerable clients.

With most property transactions a matter between the buyer, the seller and their representatives, it is not unsurprising that 83% of advisers said that one of the barriers to people involving family was the view that there was no need to involve them in day-to-day financial decisions.

Almost one in five advisers (18%) reported clients who do not wish to involve their families are concerned that their loved ones might try to talk them out of their decision, whilst 38% noted that clients being too proud to tell their families that they were struggling financially was a main factor in whether to discuss equity release with loved ones.

The role of the family in assessing financial vulnerability

If they suspect that they are dealing with a vulnerable client, the data suggests that advisers are not only increasingly aware of the support a family can offer, but also recognise the influence family can potentially hold over a vulnerable individual.

When ascertaining if a client is potentially vulnerable, two thirds (66%) of advisers ensure that they are answering questions directly, without coaching from family or friends, and 41% observe how any family or friends present react or interact in the meeting to help assess their client’s vulnerability.

Today’s data from more2life comes as the FCA announced a new consultation on a Consumer Duty to introduce more consistent standards of consumer protection and further highlights the need to assess and manage vulnerable individuals in the financial services industry.

Dave Harris, CEO at more2life, comments:

“With vulnerability a focus of the FCA, the later life lending industry has stepped up and it is good to see that significant strides have been made in recent years to identify, support and manage vulnerability as part of the advice process.

“Where possible, families can play a huge role in supporting people as they make choices around housing equity and the role it can play in funding later life.   However for some, being open about their finances is more challenging as it would break a habit of a lifetime or they are concerned that their families will worry that they are struggling financially.

“Advisers and companies within this arena need to continue to advocate for family involvement and ensure that clients give sufficient consideration to talking to their loved ones about important financial decisions.   Collaboration to enable the best practices for identifying and managing vulnerability to become commonplace is vital and is something that as an industry we must all get behind.”

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