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The evolution of financial advice

A closer look at how advice has changed with the times and what it can offer now.

Important notes

This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in.

Looking back, having a financial adviser was like joining an exclusive club. It was limited to the ‘ultra-wealthy’.

And you’d often get tied into an ongoing cost through ongoing advice.

But the world has changed, and financial advice has moved with the times.

Advice is far more accessible and flexible today. So much so that it can now play an essential part in everyone’s financial journey – all on your terms. Take one-off advice when you need it. Or opt-in to regular reviews and check-ins with your adviser.

Our advice needs have changed

50 years ago, financial planning was very simple. Most people would only get advice at retirement. The majority had a defined benefit or final salary pension to provide a guaranteed income for the rest of their lives. Back then, saving for retirement wasn’t necessarily the responsibility of the individual. Instead, it was the employer who sponsored and managed pensions on their behalf.

But planning for retirement has taken a big shift away from that.

It’s now on us to make sure we save enough and plan for a comfortable retirement. Usually, this needs to start from the beginning of our working lives. Plus, more recent pension freedoms have given us more options for our retirement, but also added complications.

Retirement advice today is more than just how to grow your money. It’s planning how we want our future to look. A big part of that is balancing the right options in the lead up and the transition into retirement that fit your personal circumstances.

And it’s not just retirement advice we need.

Advice on how to use tax allowances, long-term care, pension transfers and growing wealth for reasons beyond retirement are helpful to many. Tax allowances in particular can be complex. They can change every year and depend on personal circumstances. This is where some clients see a big benefit from advice.

As the demand for investing increases, so does the need for investment advice. Investing in general wasn’t as widely accessible, or popular as it is now. The industry was filled with jargon and with interest rates so high in the 80s, many didn’t feel the need to invest.

Again, times have changed. Interest rates have simmered from their highs in the 80s and investing is now an important part of our wider overall financial plan. And like everything, we sometimes need a helping hand. Whether to get started or make sure the investments we choose fit our financial goals.

Remember all investments can fall as well as rise in value, so you could get back less than you invest.

Technological advances

Technology drives how any industry does business. Financial advice is no different.

In the past, you had to rely on a half-yearly statement coming through in the post to have an idea of how your investments are doing. Which most likely would’ve been out of date by the time it landed on your doormat.

Today, you can take advice and see how your finances are doing online whenever you want. Whether you check the performance of your finances on a daily basis, or you’d rather dip in from time to time, you now have the choice.

And the financial plans advisers produce now are no longer static proposals. They can adapt quickly and easily. By using online tools, an adviser can map out your finances over future years and show you what would happen to them in different scenarios.

This allows for more in-depth, sophisticated planning conversations, as well as a more dynamic approach to your overall finances. Quick updates, adjustments, or complete changes can also be made if and when they’re needed.

More recently, we’ve seen changes in how an adviser can deliver financial advice. You can speak to an adviser by phone, face to face or using a video call. Most advisers now offer all options.

With more technology also comes more information. Advisers now have access to a huge pool of resources to answer your questions. The level of advice you can get today is a higher quality than many got several decades ago. These professionals can be a resource for more than just investments. They can be your go-to for tax planning, estate guidance, long-term care planning and much more.

But has the best advice really changed?

While advice has certainly evolved, if we really look at the core of great financial advice, nothing’s changed.

The best financial advice still starts with and centres around your needs and goals. It should never be ‘one size fits all’.

Our advisers still make their recommendations based on your situation, objectives and your approach to risk. You’ll get a plan which pieces your goals together. And you’ll get an expert’s view on how to achieve them and overcome any hurdles along the way.

After all, your plan should leave you feeling confident that you’ve done everything you can to secure your financial future.

Find out more about financial advice including charges

Hargreaves Lansdown Advisory Services is a wholly owned subsidiary of Hargreaves Lansdown plc, and is authorised & regulated by the Financial Conduct Authority. Company registered in England and Wales, no. 3509545. Registered office at One College Square South, Anchor Road, Bristol, BS1 5HL.


Explore our Investment Times autumn 2021 edition for more articles like this.

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    Important notes

    This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in.

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