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Adviser firms missing intergenerational and legacy planning opportunities

5 February 2019

Adviser firms are not engaging with clients’ next generations, new research from Octopus Investments has shown, and so are missing opportunities. 

Most adviser firms surveyed said they had an existing relationship with only 20% of their clients’ beneficiaries, while 58% said they were actively trying to develop these relationships. However, the overwhelming majority (95%) said they had encountered obstacles in doing so.

Nearly half (49%) of those interviewed said their clients’ beneficiaries had their own financial adviser, while 39% said it was simply not something that had been discussed. Over a third (37%) said the beneficiaries live too far away, while nearly a quarter admitted to not knowing who the beneficiaries are. A further 12% said their clients were opposed to the idea.

Paul Latham, managing director, Octopus Investment, said: “It’s well-known that we don’t like to talk to our families about death, and it can feel even harder in a professional context. Yet, in our experience, the conversation is nowhere near as bad as people expect. Most clients tend to understand the obvious benefits for their children or grandchildren and are often relieved if someone brings it up first.”

At the same time, the research revealed the breadth of the advice gap, with more than two thirds of UK adults surveyed expecting to inherit £250,000 yet do not have a financial adviser.

Latham added: “The benefits for the both advisers and beneficiaries in maintaining the relationship are clear. The adviser is able to retain the assets under advice and add to their client base, but more importantly, beneficiaries receive invaluable advice on the assets being left to them.

Keith Richards, chief executive, Personal Finance Society, said on the issue: Encouraging advisers to start conversations about legacy planning with their client’s beneficiaries, will not only benefit advisers but also spur consumers to tackle this tricky topic. Showing the value that financial planning can play at all stages in life will help to build awareness and trust in the profession more broadly.”