Majority of UK consumers welcome targeted support

To mark the FCA’s targeted support rules coming into force yesterday (6th April), new research from KPMG UK found that almost one in two people in the UK (44%) are confident they will use the support if it becomes available to them.

Over half (58%) of UK consumers have never sought professional advice on pensions or long-term savings and almost the same number (53%) would welcome being offered targeted support.

Targeted support allows financial firms to offer tailored, ready-made investment or pension suggestions to consumers. It aims to bridge the gap between general guidance and full, paid-for financial advice, making it easier for consumers to manage their pensions and investments.

KPMG found that of those consumers who have never sought professional financial advice, 31% haven’t done so because they feel they don’t have enough money to make advice worthwhile, while 26% believe financial advice would be unaffordable.

When looking across the age brackets, those aged between 25 and 44 were most open to using targeted support, with 58% of 25–34 year olds saying they are likely to use the support and 56% of 35–44 year olds saying the same. Those over 65 are the least inclined to access targeted support (22%), which is likely driven by the fact that they have already made their pension decisions.

Jane Wilson, targeted support lead at KPMG UK, commented: “The fact that almost one in two consumers want to receive targeted support creates a once in a generation opportunity to close the advice gap and support the UK’s ambition to create a nation of savers.

“The onus is on providers to make sure they really understand people’s goals and above all else, deliver careful, clear communication that actively encourages people to invest more at a time when concerns about financial scams are at an all-time high. Trust is fragile so if people feel sceptical, confused or overwhelmed when they first access financial support, the opportunity will be lost.

“The notion that financial advice is only needed if you have notable wealth is simply not true; people with modest finances perhaps need support more than anyone else. Retirement no longer means handing in your lanyard and putting on your slippers; people work part-time, take on new challenges, or dip in and out of work to suit their changing lifestyles or meet their financial needs.

“The strong appetite for targeted support amongst the young shows there’s a chance to move people beyond saving and give them the confidence to invest for the long term. Done well, this can help individuals grow their wealth in line with their ambitions, while also channelling capital into the parts of the economy that drive sustainable growth.”