Local financial planners on the rise

Local Financial Planners
Local Financial Planners

Article by Mhairi

According to research by investment giant Charles Schwab local financial planners are becoming more popular again as online influence declines.

Some of the findings from the research published in Financial Planning today earlier in the month (3/5/24) included:

  • 81% of investors said that they realised that it was important to seek expert advice from local financial planners. Great news for us!
  • Nearly 60% of investors are actually using local financial planners for advice.
  • The percentage of young people looking to social media for financial advice has fallen below 40%. That’s still high, but down nearly 10% over the last 3 years.
  • 50% of investors are reading the financial press for information. Up on previous years.
  • Although 80% still think it’s important to manage their own investments in order to be able to act quickly.

Taking professional retirement advice is increasingly important. Recent research by SJP found that the number of families with two generations of retirees would rise to over one million within the next 10 years. That will place even greater pressure on retirement incomes. Especially when you consider that:

  • 40% of people who had already retired said that they had regrets, including:
  • 17% who would have saved more into their pension.
  • 12% who would have changed their lifestyle to save more money.
  • 8% said they wouldn’t have retired early if they’d known what they know now.

Maybe FCA action against online influencers is starting to bite?

FT Adviser (16/5/24) reported that nine “celebrity” influencers had been charged with unauthorised financial promotion in relation to a high-risk foreign exchange trading scheme. This was being promoted to over 4.5 million Instagram followers of the so-called influencers. If people’s money was being put at risk, it’s vital that the FCA follows this through.

It’s been reported that the number of cases now being looked at is over 700, up 40% in the last three years. Again, an encouraging display of action which needs to set an example to others and act as a deterrent.

As an aside to online influencers, you must remember that some firms just commit old fashioned fraud by posing as authorised financial advice firms.

Like the recent case of Amey Finance Academy who took in over £5 million over three years, recommending crypto investments along with other things. (FT Adviser report 14/5/24). It seems that the firm told clients via WhatsApp that their investments were “100 certy” and “trust me bro”. It does make you wonder who would deal with firm like that! Please always check that any local financial planners that you use are fully authorised.

Sadly, this seems to be the way more and more younger “investors” are heading. Taking more risk but doing it themselves. Charles Schwab reports that on their online investment platform, younger people tend to invest in far higher risk products than older clients. Investing in Futures, Fractional shares and international companies, along with crypto of course.

Let’s hope it doesn’t go wrong because of course they will have no route to compensation because they are not being advised.

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