Almost 1 in 10 workers between the age of 18 and 24 are planning to access financial advice for the first time following the changes made by the Autumn Budget, according to a new survey from financial advice firm Continuum.
Financial advisers can expect a busy end to 2024 as 8% of UK consumers between the age of 18 and 24 look to take financial advice for the first time as a result of the Budget. This is in addition to 11% of these younger Brits who were already planning to take financial advice, and 4% who already have an adviser.
Other age groups are also looking to turn to a financial adviser, according to the survey of over 2,100 UK workers by YouGov on behalf of Continuum. The least likely group to be looking for a financial adviser is the over 65s, with 5% saying they are now more likely to seek professional advice.
Martin Brown, Managing Partner at Continuum said: “What is clear from our latest survey that is that many people are worried about the impact the Budget changes could have on their finances. It was also interesting to see that many savers are planning on reaching out to a professional financial adviser for the first time as a result.
“There is a clear opportunity for financial advisers, especially those who can appeal to these younger savers looking for advice for the first time. When it comes to getting younger people to engage with financial advice many of the suggestions focus on technology and tools, but this is just one small part of the picture.
“There are many barriers that prevent people from taking advice but three of them occur regularly amongst younger people. There is loss aversion, a tendency to desire immediate gratification over longer-term gains, and the fact that many younger people are swayed by peer-thinking and reluctant to plan long-term. For advisers to get younger generations truly engaged with financial advice, whether they be prospective clients or related to existing clients, they need to approach these barriers in a gentle and structured way.”
We asked over 2,000 UK consumers what is most important to them when it comes to choosing an adviser, 52% said trust and credibility and 32% said personalized advice and quality of service. This compares to just 26% who valued expertise and qualifications the most highly.
There is a concerning lack of knowledge about the changes made to people’s personal finances by Chancellor Rachel Reeves amongst younger people, according to the survey.
Over a quarter (27%) of those between the age of 18 and 24 said they are unaware of the changes made by the Budget, in comparison to 12% of those between 25 and 49, and just 2% of over 50s.
The apathy towards the impact of politics on personal finances could leave many young savers with a nasty surprise, according to Continuum.
Martin continued: “So far much of the discussion we have seen around the changes from the Autumn Budget have focused around the impact on estate planning and on businesses. This has led to many younger savers thinking that the changes will not impact their finances much.
“However, plenty of the changes made could have a large impact on the personal finances of younger workers. For example the continued freeze on income tax thresholds could see more younger workers pulled into higher tax rates, catching many unawares.”
Of those who were aware of the changes, younger people were more positive about the impact of the budget than their older counterparts. A quarter (25%) of those between the age of 18 and 25 were positive about the changes, in comparison to 19% of 25-64 year-olds and just 11% of those over the age of 65.
Men were more likely to feel negatively towards the Budget (50%) than their female counterparts (46%).
The single factor that made the largest impact on how people feel about the Budget was how they voted in the 2024 election. Just 2% of Conservative voters felt positively about the Budget in comparison to 40% of Labour voters.
Conservative voters were also more likely to be planning on turning to professional financial advice, with 11% saying they were now more likely to seek out an IFA than pre-Budget in comparison to just 4% of Labour voters.
The regions most likely to be looking for financial advice for the first time were Scotland (11%) and London (11%), which were also the two regions least likely to already be seeking advice.
