The economic outlook is not as rosy as it once was.
The economy is not growing as fast as predicted, and it is likely the cost of living crisis will be with us for some time. Experts are predicting that inflation will continue to climb into next year, and interest rates are likely to follow suit too – pushing up the cost of borrowing for both personal and business needs.
All this change means the value of good financial advice has never been higher.
Advice is more important through every life stage
For those starting out in their careers on lower incomes, each jump in inflation and interest rates will be keenly felt. Advice on managing inflationary pressures and an increased cost of borrowing will be important in the months ahead.
This advice will be needed not only for day-to-day financial guidance, including the ‘nuts and bolts’ of savings and mortgages, but for long-term planning on savings, mortgages and pensions.
Those working in key professions, such as doctors in the NHS pension scheme, will benefit from more technical advice designed specifically around their pension schemes – especially as concerns around increasing working hours impacting pension taxation continue to rumble on.
While for some the tax cuts will likely free up money to cover day-to-day living costs, it could be reason to more carefully re-examine household finances with an adviser.
For those closer to retirement that are examining their pension plans or thinking about inheritance planning, guidance will be critical to ensuring the technical aspects of policy are properly understood.
Keeping up to date with changes
What is clear is that the situation is likely to be fluid for some time. With the current economic policy set for a shake-up and a general election to be held no later than January 2025, the only thing that is certain is nothing is certain.
That is why as we look ahead to what the next few months and years will bring, it is clear that financial advice will become even more critical, and ensuring everyone has access to it – regardless of personal circumstance or income – is more important than ever.
Evidence suggests that the demand for financial advice – both paid and among free-to-access services – is on the up. Of the two in five people who have turned to a financial adviser for information on what inflation means for their finances, a fifth of these have done so for the first time.
There is now the opportunity for the industry to work with more individuals who need and are seeking advice, and to put systems and services in place to help close the advice gap.
Today’s situation represents an opportunity for the advisory industry to show its true value on two fronts.
First, it has a role to play in helping first-time advice seekers, and those that may be particularly vulnerable to the current economic climate, to address their financial concerns. Many in the sector may also take this opportunity to offer new or complementary services to help share guidance, or volunteer time to help charitable organisations providing access to financial advice to those most in need.
Second, demonstrating the sector can help beyond technical guidance and offer meaningful assistance to those facing changes to their circumstances and lifestyle under potentially difficult scenarios. Those advisers that can be an expert and a friend with a sympathetic ear, as well as a key service provider, will make a lasting difference to their clients.
At Wesleyan Group, we provide specialist financial support for doctors, dentists and teachers, and understand the nuances of each of their respective pension schemes, as well as the bespoke challenges these professionals face. Other advisers with different specialisms will understand too the value of long-term sector insights. Being able to offer highly tailored advice, both to personal circumstance and aligned to the professional career path, are hugely valuable for short and long-term financial planning.
Going above and beyond to help those we serve during this time is imperative. Simply, it is the right thing to do to help those facing difficulties, and the value of financial advice has never been higher.
Greg Hendricks is a financial adviser at Wesleyan Financial Services