Research from FJP Investment, published yesterday (November 21), found out of 2,000 consumers, a mere 26 per cent said they would use an adviser for help.
This trend could be detrimental as the survey found almost two in three (59 per cent) had chosen to hold their money in a savings account rather than invest it, as they believed this to be the most secure option.
But Jamie Johnson, chief executive officer of FJP Investment, said there were signs things were changing for the better.
He said: “Whilst many still value security offered by savings accounts, we are starting to see more people challenge personal finance norms, demanding further advice from banks and proactively seeking consultation from financial advisers.
“This is especially encouraging when observing millennials, as we are seeing a new wave of more proactive and educated consumers.”
The research found savers were increasingly seeking alternative options to the traditional savings account, with almost one in five (18 per cent) switching from the traditional high street bank to a challenger bank, such as Monzo.
Millennials were the most open to change, with over a third (33 per cent) claiming to have already made this switch, compared with 6 per cent of those aged over 55.
But the survey also found almost half (48 per cent) of respondents found investing in stocks and shares or property too risky in the current environment, and many were putting off making important financial decisions until after the UK leaves the EU.
Perhaps as a result two fifths (38 per cent) have seen the value of their savings decline in the past twelve months, with individuals holding an average of £18,469 in savings.
Mr Johnson said: “Savings accounts are the foundation of many people’s financial strategies. However, with interest rates as they are, it’s unsurprising that so many savers are becoming frustrated by the devaluation of their hard-earned savings.
“There’s a plethora of promising investment and savings options available to consumers, from investing in stocks and shares to debt investment; and it’s encouraging to see more consumers seizing the opportunity to make the most of their money.
“It’ll certainly be interesting to see how the savings market evolves in 2020.”
Ivor Harper, director at advice company Park Financial Limited, said: “People may hold money on deposit for a number of valid reasons. For example, to cover an expected short-term expense (new car, impending tax bill etc) or simply as an emergency access fund to cover unexpected outlays (boiler breakdown, new roof required).
“However, many people have sums in bank accounts that far exceed any possible contingency planning requirement.
"This may be due to apathy - they have always saved that way and have never got around to looking at alternatives, fear - they believe that leaving the safe harbour of their savings account will expose them to investment risk and financial naivety - they simply do not appreciate what alternatives might exist for them.”
But he warned people were eroding their savings year after year by keeping tens of thousands of pounds in these types of accounts.
Mr Harper added: “A good professional adviser can help overcome all three of the above blockages by providing the incentive to act, reassuring the saver about the level of risks involved and educating the saver as to the full range of options and, perhaps providing a spread across different low-risk products (including higher interest paying deposit options) to work out which mix of options best matches the individual’s tolerance of risk.”
amy.austin@ft.com
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