Seeing a Financial Advisor Makes Financial Sense

By: Andrew Regan

Financial advice alone is not enough to save Britons from financial precariousness, it has been revealed.

A spokesperson for AXA, Rachel West, has claimed that even when afforded access to a financial advisor, Britons' financial difficulties still remain unresolved - because many people are not motivated enough to take measures to ensure they remain in the black.

According to Ms West, AXA's summations are based on an experiment carried out on 20 households. While ten households on one side of a street were made to visit a financial advisor once a month for a year, the other ten households on the other side of a street were allowed to manage their finances as they saw fit.

At the end of the study, the households which visited financial advisors were found, on average, to have ?5,000 more to put in their UK savings accounts than those who didn't.

"For a 12 month period we tested whether if you have access to financial advice, it makes you better off, not only financially but also emotionally, if you look at the levels of stress," Ms West confirmed.

"For 12 months we had 20 households taking part, ten on one side of the street who had access to an independent financial advisor and ten who were left in the financial wilderness.

"So for 12 months the ten households were taken on a financial journey. If they had debt, we'd look at that first, then look at short to mid-term savings, moving on to pensions. Some people had company schemes that they could join but just couldn't be bothered. Those who had access were on average about ?5,000 per household better off than those who were left to their own devices. Their savings pot, as a group, dipped."

However, despite this revelation it was also found that people are reluctant to consult a financial advisor - even when they realise that it could result in cost savings and improved savings account balances.

"The incredible thing was getting people motivated to do it," Ms West said.

"You can have advice there, but trying to get people to engage and to bother to turn up for meetings... that sort of thing is a hurdle. We actually offered the people on the other side of the street, the chance to spend time with [a financial advisor], and despite knowing how well their neighbours did, nobody actually took up the offer.

"Having advice is all very well but it's about how you motivate and engage people," she concluded.

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