Almost two thirds of clients have ‘never switched’ their financial adviser

The majority of individuals that receive professional financial advice across the UK have remained with the same adviser throughout, a new study by St. James’s Place (SJP) reveals, highlighting the power of longstanding advice relationships.

More than three-fifths (62%) have never switched their financial adviser, rising to nearly three-quarters of those aged 35-54 (72%) and those aged 55 and over (74%).

Opinium surveyed just under 12,000 UK adults between May and August 2024. Quotas and post-weighting were applied to the sample to make the dataset representative of the UK adult population.

The third chapter of SJP’s Real Life Advice Report, launched on 24 October, examines the relationship between a client and their financial adviser, and the impact this can have. The study, which surveyed just under 12,000 individuals, found that the typical relationship with a financial adviser or advice firm lasts around 7 years, but this increases to over a decade for those aged 55 and over – with nearly a third (31%) of this generation having been with their adviser for 16 years or more.

Trust, understanding and financial satisfaction are the main reasons for never switching financial adviser:
o Trusting their adviser (39%)
o Being happy with the advice and financial returns their adviser has delivered (35%)
o Their adviser understanding their financial situation (34%)
o Having a good relationship with their adviser which has been built over several years (33%)
o Their adviser understanding their long-term goals and helping to deliver them (29%)
o Their adviser looking after both them and their family (21%)
o Their adviser having helped them through big life stages/ moments (18%)

Andy Payne, head of the St. James’s Place Financial Advice Academy, said: “Financial advice is about much more than numbers on a page or graphs on a screen. It’s about building deep, meaningful relationships, and as our research shows these can last many years and span generations. Whether you’re navigating the early stages of wealth creation, planning for retirement, or managing an unexpected life change, having a trusted adviser by your side can make all the difference.

The study also explored the benefits of ongoing financial advice. These include putting the foundations in place for a stronger financial future, with 32% saying it’s helped them to save more money for retirement and 22% saying it’s ensured they have adequate protection in place if they need it.

Ongoing financial advice has helped more than one in ten with major life goals or moments, such as getting on the property ladder (13%) or navigating difficult periods like divorce or bereavement (13%). Others have been able to pass on money to their children or loved ones (19%), to better manage the cost of raising children (12%), or to provide more financial support to elderly family members (11%).

Additionally, financial advice has empowered individuals to improve their quality of life – from giving them more flexibility in their job (16%), affording larger purchases such as a car (13%) to realising the dream of upsizing to a new home (9%). Moreover, 10% have used ongoing financial advice to start their own business, while 8% found support in starting or expanding their families, including through IVF and adoption.

Given these benefits, unsurprisingly 86% of those currently receiving advice from a professional financial adviser would recommend getting advice to family and friends.

Andy Payne continues: “These goals, moments and milestones may be common to many throughout their lives, but the specific circumstances will always be unique. Having support from an expert financial adviser, with not just the technical expertise but the empathy to deploy it sensitively and with their clients’ needs in mind, can be the difference between a hope dashed and a dream realised.”

Over the coming weeks, St. James’s Place’s Real Life Advice Report will continue to explore the benefits of accessing financial advice or guidance through diverse real-life stories from its advisers and clients. The report, released in a series of chapters, aims to highlight how financial advice and guidance can benefit everyone.

Source: PA