Despite the urgent need for greater personal finance education and support, there are currently only 26,000 financial advisers across the UK – that’s only one adviser for every 2,000 adults¹.
This figure is set to drop even further over the coming years as thousands of financial advisers are set to leave the profession. But there is a noticeable absence of the next generation coming through to fill their shoes, largely due to a lack of awareness of financial advice as a career option.
Research issued today from Octopus Investments reveals that nearly one in three financial advisers (29%) say they will retire in the next five years and 58% in the next ten years. But among both students and second time careerists considering their next step, a job in financial advice is simply not on their radar.
Students not even aware of advice
When students were asked only one in ten (9%) would consider financial advice as a career. Over a third (36%) didn’t even know what a financial adviser does.
Barriers holding students back from considering financial advice were that many don’t think their personality is suited to it (37%) or they don’t want, what they perceive to be, a corporate job with an office base (23%).
But once explained what the role as a financial adviser entails, a much higher proportion (43%) would consider it. Students highlighted that financial advice could fit with their top job criteria of high earning potential (51%), problem-solving (49%), flexible working (43%) and the ability to make a real difference to people’s lives (39%).
Advice not considered by second careerists
Among adults, surprisingly three quarters (74%) said they would consider a career move in the next five years. But the same proportion have never considered financial advice as an option. One in five (18%) didn’t know what a financial adviser does.
But once they understood the remit of finance advice 45% of adults said they would consider it. The majority said this would fit with their top asks of being able to work flexibly (57%), helping others (56%) and having high earning potential (53%).
Ruth Handcock, CEO of Octopus Investments said:
“Financial advice is often widely undervalued as a career. We work with thousands of advisers across the UK and often hear about the challenges with training and recruiting as there simply isn’t high enough awareness of the industry. A good financial adviser should be likened to the value of a doctor. They assess a person’s financial situation and can provide invaluable advice and support. We’ve seen first-hand the benefits that financial advisers bring, providing peace of mind and helping people save and invest and most importantly reach their personal life goals.”
Keith Richards, CEO of Personal Finance Society said:
“Both the need and demand for professional financial advice is set to increase but much more needs to be done to raise the profile of financial advice in the UK to attract new talent. As the profession is still relatively young, it’s simply not seen as a career choice in the same way as Accountancy or Law, yet it can be highly rewarding with the power to change people’s lives, helping others achieve their life goals and objectives through effective financial planning. Chartered Financial Planner status is helping to change perceptions but we need to work in partnership with firms, organisations and academic bodies to raise awareness of the profession to encourage the next generation to consider it.”
Ross Jefferies, Financial Adviser at Panoramic Wealth said:
“I followed in my dad’s footsteps starting out in the advice profession straight out of school and wouldn’t change it for the world! Five years on, I’ve learnt vital skills, been independent quickly and more importantly seen the massive difference we can make to people’s lives. For example, I’ve helped people I didn’t even know until a couple of months ago, get the house they’ve always wanted. The job also comes with loads of flexibility and is more fun than people would expect. Many young people don’t think about it as a viable career – they understand the role of accountants and lawyers but not financial planners. We need to ensure financial education is introduced into schools to challenge the perception of the profession. I would encourage anyone who enjoys problem-solving and wants to make a difference to take a look at advice.”
Notes to editor
*Research conducted via an online survey among 2061 adults from 19 to 24 June 2019 and 1002 UK students aged 18-21 currently studying for, or have studied A-levels or higher education from 18 to 27 June 2019 by Opinium Matters. Research was also conducted among 205 UK financial advisers from 17 to 21 June 2019 by Opinium through a monthly IFA panel.
1) ONS, Population estimates for the UK, England and Wales, Scotland and Northern Ireland: mid-2017 (June 2018)
For journalists in their professional capacity only. The value of an investment, and any income from it, can fall as well as rise. Investors may not get back the full amount they invest. Personal opinions may change and should not be seen as advice or a recommendation. We do not offer investment or tax advice. We recommend investors seek professional advice before deciding to invest. Issued by Octopus Investments Limited, which is authorised and regulated by the Financial Conduct Authority. Registered office: 33 Holborn, London, EC1N 2HT. Registered in England and Wales No. 03942880. Issued: August 2019.