Keeping it in the family – two in three people accessing advice share same adviser as their parents

67% of people whose parents have a financial adviser also use them, citing ‘feeling relaxed’ and ‘relieved they can be trusted’ as key reasons for their IFA choice
Despite keeping financial affairs in the family, almost half (49%) admit they prefer to pay for advice separately
An unexpected windfall, inheritance and preparing for retirement are key prompters for seeking financial advice, however this differs among generations
Prudential UK launches new Family Wealth Unlocked report on intergenerational planning and wealth transfer between advised families amid the Covid-19 pandemic

As families up and down the country turn to financial advisers to support them with wealth transfer and future planning during the global pandemic, IFAs are unlocking family wealth by working with multiple members of the same families.

According to the new Family Wealth Unlocked report from Prudential UK, two thirds (67%) of people whose parents have an adviser also use them, suggesting a huge potential for advisers to target different generations within the one family.

Two-fifths (43%) of respondents said they would feel relaxed about using the same adviser as their parents, while a third (34%) said they would trust them, and they’d feel relieved.

But while many families share the same adviser the research highlights a big opportunity for IFAs to bridge the advice gap, as 33% of people whose parents have a financial adviser do not also use them.

The report, which looks at intergenerational planning and wealth transfer between advised families amid the financial volatility and insecurity of the pandemic, found that respondents favoured instructing advisers for their distinct needs, in place of shared family-wide goals. This perhaps suggests why the report also showed that 49% of those who have used the same adviser as their parents prefer to pay for the financial advice separately.

Despite the need for a tailored approach to advice, the study pointed to a broadly positive approach to discussing finances openly within the family. Almost half 47% admitted to ‘talking openly to each other about finances’ with only 7% revealing they ‘don’t trust their family members’.

An unexpected windfall (24%) receiving an inheritance (24%) and preparing for retirement (23%) are the key scenarios most likely to prompt consumers to seek advice from a professional financial adviser. Although while integrating families’ financial situations will enable more holistic wealth transfer opportunities, advisers will need to balance these wider needs with individual generation-specific objectives, whether it’s saving for a deposit, school fees or planning for retirement.

What are the areas individual generations most want advice on today?

Vince Smith-Hughes, Director of Specialist Business Support at Prudential UK, said : “Families are becoming increasingly aware of their legacy and wealth transfer. It appears the Covid-19 pandemic has been a contributing factor in bringing families together to talk more openly about their futures, consider their financial goals and begin planning accordingly.

“Our report also highlights how, especially for the younger generations, the need for financial support and guidance is most pronounced. It is hugely encouraging that many people are seeking the services of the same financial adviser as another family member at some stage during their life. And, with around 86% of those seeking advice actively doing so in the last five years, it seems the value of advice is increasingly being understood.”

“But clearly there is still room for improvement as around a third of people don’t currently have a ‘family adviser’ and, with £5.5 trillion set to pass to the next generation over the coming years, this is an issue that advisers must help to tackle.”

A full version of Prudential UK’s new Family Wealth Unlocked report can be found here: https://www.pruadviser.co.uk/knowledge-literature/insights-hub/igp-hub/wealthunlocked/

Download a PDF of the release

Enquiries

Teamspirit - Vicky Duckett

+44 (0)7772 980 891

VDuckett@teamspirit.uk.com

Teamspirit - Nadia Guarino

+44 (0) 7464 985 112

NGuarino@Teamspirit.uk.com

Notes to editors

Open1.

https://www.kctrust.co.uk/partner-blog/infographic-intergenerational-wealth

OpenMethodology

Research was carried by Opinium among a UK representative sample of 1,000 advised families. The survey was completed in November 2020.

What are the areas individual generations most want advice on today? Base size: Gen Z – 25, Millennials, 543, Gen X – 215, Boomers – 196, 75+ - 21.

OpenAbout Prudential UK

Prudential UK & Europe is part of M&G plc which is a leading savings and investments business, and has been caring for customers for over 170 years. It has a long history of finding innovative solutions for customers’ changing needs.

Its purpose is to help people live the life they want by managing and growing their savings. And by helping to direct how and where people invest their money, it can help make the world a little better.

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