Financially vulnerable are not telling their IFA

25 January 2022

Seven in 10 over-45s have found themselves facing potential financial vulnerability, yet few would tell their financial adviser, according to research by retirement specialist Just Group.

Of these, nearly a third (30%) admitted their ability to make decisions was affected due to their circumstances including job loss, illness or bereavement, but most chose not to tell their employer or financial services companies.

Only 16% opted to tell their financial adviser and 14% their employer, while just 11% alerted their bank or credit card company and 9% their mortgage company.

Stephen Lowe, group communications director at Just Group, said: “This research shows that most people recognise when they are facing circumstances that could make them vulnerable but many are reluctant to disclose it.

“While it’s understandable that people may not want to talk about their circumstances and try to tough it out on their own, they should bear in mind that many financial providers and advisers will have specific policies in place to help anyone struggling because of their circumstances.

“Regulated financial firms are under increasing scrutiny to identify and provide support to vulnerable customers to ensure they are not disadvantaged.”

While vulnerability tends to be associated with older people, the research found that those aged 45 – 54 were almost twice as likely to answer yes than those aged over 75.

When asked what factors could make somebody vulnerable, 84% said a health condition or mental illness, while 81% cited a major life event such as bereavement, job loss or relationship breakdown.

In addition, just over three quarters (78%) said low levels of knowledge in financial matters could make somebody vulnerable and a similar percentage (77%) said a lack of confidence in managing money and falling behind with credit commitments or bills in three or more of the last six months would have an effect.

Professional Paraplanner