Almost half of the adult population could have benefitted from money advice at key stages in their lives, according to a new report published by Citiz…
Almost half of the adult population could have benefitted from money advice at key stages in their lives, according to a new report published by Citizens Advice.
The British charity reveals that had they been offered it, 48 per cent of people would have taken financial advice when having a baby, buying a house, getting divorced or falling ill. Had that advice been available, over 23 million people who would have liked advice on money issues believe that this would have helped them to avoid financial problems in the future.
The report shows that financial advice, support and guidance is needed to to respond to a person's real life situation, but realistically there are many gaps at present. It widens the debate around the advice gap by identifying four gaps where the help or guidance is either not accessible, or not available, for people to plan around their finances.
The affordable advice gap affects consumers who are willing to pay for advice, but feel that current prices are too high. If costs were reduced, up to 5.4 million more people would consider paying to receive sound financial advice.
The free advice gap is evident for people who would like financial advice but are unable to pay for it. Up to 14.5 million people who think they would benefit from free advice haven’t taken any in the past two years. This includes 735,000 people who have tried to access free advice but have found that they were unable to receive it due to a lack of supply.
The awareness and referral gap affects those who are unaware that advice exists for their particular situation, or are unsure where to turn to to receive this advice. The results of the report shows that as many as ten million people believe they would benefit from free advice, but are unaware that it is available, or when speaking to a professional were not directed to where this advice could be sourced.
The preventative advice gap encompasses those who would benefit from receiving money advice as a preventative measure. As many as 23 million people have fallen into this gap at some point in their lives, and 1.2 million of these people have taken advice but the non-financial causes of these problems has not been addressed.
It's clear from the study that there are gaps in the provision of financial advice, including everything from regulated independent financial advice to general money guidance.
Chief executive of Citizens Advice Gillian Guy said: "As it stands too many people aren’t getting the money advice, support and guidance they need at key moments in their life such as when they buy a house or have a baby. Money advice can be vital to make sure people can make the right financial decisions now in order to avoid money problems in the future."
The need for free money advice continues to exist alongside demand for paid for money advice. Many people are willing and able to pay different amounts, for different types of advice at different times in their lives, and large numbers of people would benefit from access to both free and paid for money advice. In a well-functioning system, they should complement each other.