UK lacks pensions and investment confidence but is reluctant to pay for advice

Back to results
  • Just 14% of people are confident about planning their retirement goals and investing themselves
  • Only 20% are comfortable deciding how to access their pension independently
  • However, less than a quarter (22%) of people will seek advice when planning their pension goals
  • 90% who have taken advice said they were happy or satisfied with the service 

New research from Aegon UK has found that just 14% of people are confident they can plan their retirement goals and invest to achieve the retirement they want. 

A minority of savers are confident in a DIY approach to pensions and investments. Just a quarter said they would be happy selecting a pension product (23%) themselves, and only a fifth (20%) feel confident that they know how to access their pensions at retirement.  Yet an overwhelming 78% had not sought financial advice specifically about their pension provision. Three quarters (73%) of people said the prospect of having to pay for financial advice puts them off seeking help.  

However, amongst the 46% of the population that has sought advice, 90% said the service they received was good or they were satisfied, indicating the barrier is not the quality of advice on offer. 

In contrast, a majority of people are happy to buy non-investment financial services products without advice. Almost two thirds (63%) of UK adults have a high degree of confidence choosing a savings account, while three fifths are happy choosing car insurance (60%), and home insurance (58%) independently. 

While willingness to seek advice is still relatively low, people are happiest to seek advice regarding making an investment in the stock market (27%), deciding how to best mitigate inheritance tax (27%) or when choosing a mortgage (26%). Just over a fifth would consider asking for advice on planning their pension goals (22%), consolidating their pension pots (22%), or selecting a pension product (21%). 

Duncan Jarrett, Managing Director for Retail at Aegon said:

“We now know the scope of the Financial Advice Market Review (FAMR) but the scale of the mountain the industry and government has to climb when trying to bridge the advice gap is clear. The problem is also pressing given that the pension freedoms have introduced much greater flexibility but also a range of more complex choices at and through retirement. 

“The price comparison business model has revolutionised the way people buy simple retail financial services products and, as our research highlights, the majority of people are happy making decisions when it comes to products where they can compare simple features and costs. The difference when it comes to pension and investment decisions is marked. Only a minority are confident of a DIY approach, yet only small numbers are willing to ask for help. This is despite the fact that 90% of people who have taken advice were happy with the service which suggests it is the cost, rather than the service which is the biggest barrier.

“A concerted effort is needed from the industry to explain the value of advice. There are few easy answers when it comes to bridging the advice gap, but we expect that digital tools and the introduction of guidance services are likely to play an increasing role in supplementing the future advice landscape.”