Your IndustryNov 18 2015

Forget ageing advisers - typical client is 70-years-old

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Forget ageing advisers - typical client is 70-years-old

A survey conducted by Russell Investments found that 46 per cent of UK advisers claim that 20 per cent to 50 per cent of those that they give advice to are aged 70 plus.

A further 8 per cent claimed that those over aged 70 plus made up more than half their client list.

Claire Walsh, Chartered Financial Planner at Aspect8, said: “I think there are many reasons for this. In general older people do tend to be wealthier, so are more likely to seek advice and most financial advisers are older.

“What tends to happen is that an individual may go to a financial adviser as they are approaching retirement age, so people around their late fifties.

“Quite often they stay with that adviser for other matters so these figures don’t surprise me at all.”

The 53 strong survey, which took place last month, also demonstrated that when it, the majority of IFA-advised people have drawn down less than a fifth of their pension pot following pension reforms.

Almost a third have withdrawn between 20 per cent to 50 per cent of their funds, with only 7 per cent drawing down more than half of the pot.

Nick French, managing director and head of UK wealth management at Russell Investments, said: “With pension freedoms giving over-55s more flexible access to their retirement savings, IFAs have an opportunity to appeal to and attract a younger demographic.

“This is particularly important considering the current age demographic for most clients is heavily skewed towards older generations who are more familiar with the value that financial advice can bring.

“Advisers need to be communicating and engaging with today’s younger generation on the importance and value of advice, otherwise the demographic issue some of them currently face could have implications down the line for future revenues and cash flows.”

Russell Investment’s research into the age of adviser clients comes after earlier this year Vision Business Advisers surveyed more than 600 UK investment advisers, over 470 of which were sole traders, with most of the remainder being smaller practices comprising five or fewer IFAs.

Their analysis found that the average age of the individual advisers was 58 years, with the oldest being 77 years and the youngest 31 years.