X

X

Advisers helping their clients rebuild after pandemic

New research from The Openwork Partnership, one of the UK’s largest and longest established financial advice and investment networks, shows advisers are working hard to help clients review their finances in the wake of the COVID-19 pandemic.

Its study found advisers estimate that on average nearly half (46%) of their clients are engaged in comprehensive reviews of their financial situation in the wake of the pandemic. For nearly a third of advisers (30%) that figure rises to 75% or more of their clients.

The pandemic has had a major impact on advisers and their clients, research found. Advisers estimate that on average 15% of their clients have suffered financial losses during the crisis. Around one in 10 advisers warn 30% or more of their clients have suffered financially.

However, the comprehensive financial reviews are addressing a wider range of issues than just financial losses. The Openwork Partnership research found advisers say clients are most likely to have stopped saving or investing or to have taken money out of pension funds.

Around half of advisers (46%) say they have seen clients stopping saving or investing while 44% have seen clients take tax-free cash earlier than planned on their pensions while 40% report clients have taken money out of pension funds.

Around two-fifths (37%) say clients have been running down savings and reducing their drawdown income while 26% have cashed in investments. The table below shows the major actions clients have taken.

Actions clients have taken as a result of being adversely financially impacted by pandemic % of clients
Stopped investing or saving 46%
Taken tax-free lump sums earlier than planned 44%
Taken money out of their pension funds 40%
Run down savings 37%
Reduced pension income from drawdown 34%
Sold investments 26%
Adapted investment strategy in line with changes to their attitude to risk 16%
Downsized or started to downsize their main home 9%
Released equity from their property 8%
Remortgaged to reduce their mortgage payments 7%

Source: The Openwork Partnership 2021

More than half (54%) of advisers have also seen an increase in clients cashing in on pensions early by taking tax-free cash or going into drawdown during the crisis.

Mike Morrow, Chief Commercial Officer at The Openwork Partnership, said: “The pandemic has undoubtedly had an impact on people’s finances with winners as well as losers.

“With so many changes, it is good to see that more people have been seeking professional advice to ensure their money works hard for them. What might seem like a good idea right now could have negative consequences for you later in life. It’s best to get help from a financial adviser and ensure you have all the details necessary to make an informed decision.”

This Week’s Most Read

  • Baronsmead VCTs exit first sterling unicorn after Ideagen sale

    Gresham House’s Baronsmead VCTs have exited their stake in compliance software business Ideagen following its sale to private equity firm Hg Capital. The deal values

  • Fund Research Governance: is ‘fine’ good enough?

    Written by Laura Bampfylde, Director, Global Assets – Wealth, at Redington One of the most enlightening books I’ve read was written by husband-and-wife psychologists, Alan

  • ONS: Repossessions by county court bailiffs increase from 45 to 770 (1,611%)

    Following the latest Mortgage and landlord possession statistics published this morning, which reveal repossessions by county court bailiffs increased from 45 to 770 (1,611%) between

  • PIMCO: US CPI Preview

    By Tiffany Wilding, North American Economist, and Allison Boxer, Economist at PIMCO  This week focus turns to inflation, where recent commodity price weakness will become

  • Creating a profitable HNW/LNW advice service in specialist markets

    By Simon Binney, Business Development Director, Wealth Wizards For financial planning firms targeting new clients, often the problem is not attracting clients to their business,

  • #Podcast episode 7: JM Finn’s Sir John Royden on his superhuman swim for The Brain Tumour Charity

    This week’s podcast episode is something a bit different for IFA Talk…but certainly not an episode to be missed! Sue and Bex talk to Sir

  • FCA issues letter to alternative investment firms’ CEOs – experts comment

    The FCA has today issued a six page letter to CEOs of alternative investment firms about their supervisory strategy for such firms. David Newman, chief

  • Tackling Burnout in Financial Services

    Financial services professionals are increasingly suffering with stress which can often lead to burnout – a state of physical and emotional exhaustion. Latest research tells

  • Advisers concerned clients are risking HMRC fines over trusts

    Advisers are concerned about their clients risking HMRC fines, by failing to register trusts with the Trust Registration Service (TRS) by 1st September, according to

  • PIMCO’s Tiffany Wilding: The Era of Kinder, Gentler Central Banks Is Over

    By Tiffany Wilding, PIMCO’s North American Economist Last week, the Bank of England (BoE) was the first major central bank to admit that it is

Latest IFA Magazine Podcast Episodes

Keep updated on the most important financial events 

Make sure you are an informed

wealth professional..

Adblock Blocker

We have detected that you are using

adblocking plugin in your browser. 

IFA Magazine