More than eight in 10 financial advisers are optimistic about the future prospects for the industry, according to a recently launched confidence index by National Savings & Investments.
The first edition of the quarterly survey, which was conducted in February, May and July 2016 and involved a average sample of 115 advisers, revealed that intermediaries’ confidence has been high.
Adviser confidence peaked in May with 90 per cent of respondents stating they were either ‘fairly confident’ or ‘very confident’.
Comments left by the survey participants suggest that the increased complexity facing consumers and thus the greater need for advice has shaped their optimistic outlook, according to the NS&I.
The reduction of the Financial Services Compensation Scheme compensation limit from £85,000 to £75,000 has prompted seven out of ten of the respondents to advise their clients to spread cash deposit savings around multiple UK financial product providers.
In addition, the study found on average, more than 50 per cent of respondents said protecting clients’ assets was the most important priority for their clients in terms of savings and investment options in the months of February, May and July.
Steve Owen, acting chief executive of the NS&I, said: “Although the financial advice market is rapidly changing, this first edition of NS&I’s financial advice barometer suggests that cash deposits remain a key component in advisers’ proposition to their clients.
Each quarter, the survey also asks one-off topical questions. The July edition asked advisers whether significant market uncertainty or volatility encouraged them to move a bigger proportion of their clients’ funds into cash. Just under half (48 per cent) of advisers, answered ‘yes’ or ‘sometimes’.
David Finan, managing director of Cumbria-based Jardine Finan Wealth Managers: “For clients with substantial cash deposits, it makes sense for them to spread their savings. I think the risk of losing their savings is low but it is a risk nonetheless.”