The past 18 months has seen a rise in the number of over 50’s seeking professional financial advice, according to new research from Scottish Widows. The study found that the most common reasons for the surge in sourcing advice were pension planning (56%), early retirement (54%), part or phased retirement (53%) and accessing pensions at the point of retirement (53%).
There are some indications that the pandemic has been the driving force behind the rise in demand for advice, with lockdowns, uncertainty or even building up more savings than expected, being some of the potential motivations for people in this age bracket have been reaching out to advisers.
There are many further reasons why seeking advice in the current climate is a good idea. Against the backdrop of continuing low interest rates being offered by banks in cash savings accounts and relatively high rates of inflation, investing is becoming an increasingly popular option as people begin to realise the potentially detrimental impact cash savings may have on the ability to save for the longer-term.
Volatility in the markets is another trigger – the availability and reported uptake of online investment platforms may open up the idea of investing to potential new audiences. However, it may soon become apparent that choosing investments and managing a balanced portfolio is harder than it may appear. Opting to move investments over to a financial adviser, from whom advice can be sought in relation to the wider questions around financial planning, may prove to be an attractive option for some.
It is positive to hear that financial advice is being prioritised by those over 50 and that people are planning their options around retirement. The sooner retirement is seriously considered, the greater the number of options there are likely to be available in later life. Knowledge can provide power, putting you in greater control of your financial situation and the choices you have available to you. The choices you make in the 10 or 20 years ahead of retirement can prove critical in your ability to retire at the age you would like, and the funds that will be available to you at that time.
It goes without saying that the earlier a financial plan is put in place and payments start being made into suitable investments, the longer a portfolio has to grow and the more time compound interest has to take effect. It is for this reason that you can never be too early when it comes to seeking financial advice!