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Workplace saving could help close the financial advice gap

25 January 2013

Workplace saving could become a growing market for advisers and providers and help close the UK’s financial advice gap following the introduction of the Retail Distribution Review (RDR), according to Deloitte, the business advisory firm.

Deloitte research indicates that up to 5.5m people will reject paying a fee for financial advice – but a significant proportion is open to the idea of financial advice sourced by their employer.

  • A third (33%) of employees would pay for an in-house financial adviser provided by their employer;
  • 18% would use more financial planning services through their workplace if it were offered by their employer (or a third party acting on behalf of their employer);

However, the development of work-based financial planning faces obstacles.

  • More than a quarter of employees (27%) do not want their employer to know more about their financial arrangements, and nearly one in five (19%) do not trust their employer to provide financial advice or planning;

Andrew Power, lead RDR partner at Deloitte, said:

“The RDR and introduction of adviser charging poses significant challenges for advisers and providers. One option for them is to increase work-based financial advice, although there are hurdles to overcome. More than a third of people (34%) have a company pension, giving them an obvious reason to seek financial advice in the workplace. From the providers’ perspective, this opportunity to give advice in the workplace is significant.

“Deloitte’s research indicates people will be willing to use a work-based adviser, particularly if their employer shares the cost of advice. Dealing with a larger number of people at an office also gives advisers an opportunity to reduce the cost of advice.”

- Ends -

Note to editors:

About RDR
The Retail Distribution Review came into force on 31 December 2012, and changed the way consumers pay for financial advice. Commissions paid to financial advisers by providers for recommending retail investment products are banned. Advisers instead have to agree remuneration arrangements with customers before charging them directly.

About Deloitte
In this press release references to Deloitte are references to Deloitte LLP, which is among the country's leading professional services firms.

Deloitte LLP is the United Kingdom member firm of Deloitte Touche Tohmatsu Limited (“DTTL”), a UK private company limited by guarantee, whose member firms are legally separate and independent entities.

Please see www.deloitte.co.uk/about for a detailed description of the legal structure of DTTL and its member firms.

The information contained in this press release is correct at the time of going to press. 

Member of Deloitte Touche Tohmatsu Limited

Media contacts

Name:
David Gwyer
Company:
Deloitte LLP
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Email
dgwyer@deloitte.co.uk

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