A third of UK families share financial advisers

4 min read 16 Jun 22

New research from M&G Wealth looks at intergenerational planning and wealth transfer between advised families amid the continued financial volatility and insecurity particularly with the soaring cost of living. Plus how families personally feel about having the same financial adviser as their families.

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Inheritance Tax Planning – not just about reducing your liability

One of the many significant findings in this research, is that intergenerational planning has undoubtedly moved on from focusing solely on the reduction of IHT liabilities. This makes sense, as while ‘reduction’ remains at its heart, intergenerational planning has a major role to play in delivering on in-life needs for both the caretaker generations and those due to inherit.

Living for today or tomorrow?

The need to balance the tomorrow with the today has rarely been greater. Inheritances will, on average, now be received only when the next generation is over 60. Inflation is at a multi-decade high and the pressing needs of younger generations risk being compromised.

Positively, the report shows how families are sharing advisers across generations; how conversations about inheritance are taking place openly; and how gifting strategies are being deployed to support – and bring happiness to – children and grandchildren. Arguably when it’s needed most.

In case you missed it catch up on our article about the family linking facility on the platform. Find out how by inviting different family members to share in economies of scale on charges and enable holistic, coordinated planning, firms can offer a really compelling advice proposition – and put each family’s wealth-planning on a more robust footing for generations to come.

Has COVID had an impact?

The research shows how each generation’s priorities are fast evolving in sustainable investing, expectations of advisers – and their comfort with accessing advice online. Evidence of the increased normalisation of multiple generations of the same family sharing an adviser is significant on many counts: for the caretaker generation, for tomorrow’s generations, and for the business of advice in building sustainable and profitable businesses.

Using the same financial adviser

One in three (33%) advised families use the same financial adviser as another generation of their family – or in-laws, according to the second iteration of the Family Wealth Unlocked report by M&G Wealth. Of those who have an adviser, well over half (57%) share them with their parent(s) - including biological, step and adopted. While two in three (65%) share an adviser with their grandparent(s), and a third (34%) with their In-laws/partner’s parent(s).

Sharing an adviser brings a wealth of benefits says respondents, including saving money on tax (35%), ensuring everyone in the family is treated fairly (38%), helping younger family members (34%), ensuing the family is aware of each other’s financial situation (37%) and supporting a parent(s)/ grandparent(s) (34%).

Many though still want financial independence. Of those who share an adviser with their parents, a third (34%) pay for them separately, and almost the same number (35%) who share an adviser with their grandparents spilt costs to pay individually. A good number of each of the older generations – grandparents - (19%) confirmed they are paying for the younger generation’s advice.

Seeking advice

At what continues to be a challenging time for families up and down the country, many are turning to financial advisers to support them with wealth transfer and planning. More than half (53%) of respondents say they have received financial advice in the last 12 months, of which one in five (20%) have received advice in the last three months.

Vince Smith-Hughes, director of specialist business support at M&G Wealth, said: “Our research shows the positive power of financial advice particularly in today’s challenging economic climate. With families contending with the increased cost of living, there has never been a more crucial time to get support and plan financially for the weeks, months and years ahead.

“Our research indicates that families feel happier talking to an adviser who is known to them and who they can trust. Many of the families we spoke to are also investing for each other’s financial futures, with almost a fifth of grandparents paying for their grandkids to receive financial advice. The fact that people are taking steps to not only get their own finances in order, but also those of their family members is heartening to see, especially amid all the economic uncertainty.”

Register to get your copy of the M&G Wealth’s new Family Wealth Unlocked report above.

Methodology

Research was carried by Opinium among 2,000 UK adults (18+) who have personally, or who have parents, or grandparents, who have received financial advice from an adviser in the last 5 years.

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