CompaniesMay 15 2013

‘Better financial awareness could cut the cost of advice’

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The marketing director of London-based national advisory firm Helm Godfrey said if consumers were more comfortable and knowledgeable it could help to reduce the cost of basic financial advice.

Helm Godfrey will host a series of seminars, starting in June. Mr Fox said the retail distribution review had created a “huge gap in the market” for consumers who will not pay for professional advice but were “utterly lacking in financial education”.

He added: “We held some focus groups which showed a horrific level of misconception about money out there. But let’s say somebody has £50,000 to go through the take-on process – it’s actually going to be very expensive, especially if you’re charging by the hour.

“If a potential client attends this workshop, they’ll do a lot of the groundwork for advisers. They’ll be able to work out their budget, risk rating and other basic characteristics.”

Mr Fox argued that the preparations would enable clients to enter the advice process at a lower price level and make meetings more productive.

Barry Brown, wealth management adviser for Helm Godfrey, said: “There is a real lack of financial education in this country. Yet there has never been a greater need for an understanding of budgeting, investments and pensions. Greater knowledge can make a world of difference.”

The first workshop will take place in London on 13 June. More are planned for the rest of the year.

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Jonathan Hill, financial services manager for Somerset-based advisory firm Milford & Dormer Solicitors, said: “I think anything that increases education has got to be good. A lot of people have distrust towards the industry and commissions have done us no favours in terms of perception.

“However advisers need to make clients realise the added value of their service. Research shows that do-it-yourself investors don’t do as well as advised investors.”