Adviser confidence drops despite rising client satisfaction
Only 69% of financial advisers have confidence in the future of the advice market despite rising client satisfaction levels, according to a new report.
Only 61% of advisers surveyed for the Embark confidence barometer were confident in their ability to charge enough, in comparison to 80% last year.
Male advisers were less confident than their female counterparts.
Among female advisers confidence was 75% in comparison to 53% of male advisers.
The twice-yearly survey of 1,000 investors and 251 advisers found that 85% of adviser investors were satisfied with their financial adviser. Only 4% described themselves as dissatisfied.
This represents a significant increased from the last barometer report in which 68% of advisers customers said they were satisfied and 8% were dissatisfied.
Adviser clients were most satisfied by their adviser’s ability to understand their needs (86%), overall communication (84%) and investment recommendations (81%).
Jamie Drewett, group head of distribution at Embark, said: “Our results suggest some advisers may be going through a turbulent – even a confusing – time. If clients are highly satisfied with their adviser, and if the last couple of years has even helped to boost appreciation of the value of advice, why aren’t they feeling more optimistic?
“Anecdotally, advisers are telling us that price pressure from the self-serve market, rising professional indemnity and FCA costs, and even the weight of MiFID compliance, are affecting confidence.
“However, advisers will always have one strong reason to believe in the health of the market – the value of advice. Advisers we have spoken to have been clear that, while there will always be a conversation to be had on costs, it does not need to be a differentiator.”
Over three quarters (83%) of the advised clients surveyed said they would be comfortable recommending their adviser to friends and family.
The Embark Investor Confidence Barometer surveyed 250 advised customers with a minimum of £100,000 investible assets between the age of 35 and 70. It also surveyed 503 non-advised customers and 251 financial advisers from firms with assets under advice of under £500m.