Advice is over complicated, too expensive, inaccessible or oversimplified and lacking a human touch in the case of robo-advice, says Lambert.
But given our propensity to use technology to do everything from check the weather to pay for goods and services, there is considerable scope to use technology to help augment the advice process and make it more inclusive.
Bestinvest, for example, has created a dual process to help to bridge the advice gap with some free person-to-person investment coaching, and also specific fixed price one-off advice packages starting at £295, depending on what is needed.
It splits coaching and financial advice, with the former about offering education and guidance “to empower people to make better investment or financial decisions”. The latter recommends what you should do, as opposed to outlining your options for you to make your own decisions.
Jason Hollands, managing director of Bestinvest, adds: “There is an advice gap in the UK between wealthier people who can afford personalised financial advice and those with more modest savings who do not have access to professional advice or perceive it to be too costly for them – even though they do not have total confidence in their choices and decisions.
“Coaching is typically aimed at those whose finances are not so complex – a group of people who have historically been underserved by the financial advice industry. While a lot of information and opinion is available online – and among social media influencers or down the pub – the plethora of voices can be overwhelming, confusing and sometimes misleading. So, coaches aim to cut through the fog with clear, best-practice guidance.”
Increasingly, it seems advisers are content to offer clients what they need in the format that they need it. While this may go against the “norm of traditional advice offering”, notes Lambert, some people just need a helping hand “to guide them in the right direction from time to time”.
Move towards technology
However, a greater move towards the use of technology in advice needs to be addressed from a regulatory perspective too, says Panacea's Bradley, with the FCA deciding where the liability lies if the advice goes wrong in “10, 20 or 30 years’ time”.
Bradley adds: “If technology is the solution, then technology must carry the liability and not the advisory firm who uses it. To make it work, the FCA should, rather like the pharma or aviation world, certify that the algorithm technology is fit for the purpose.
“That would mean the FCA – [akin to] the CAA of the aviation world– test flying themselves along with the manufacturers. Think Boeing, think Max 8. It’s not the airlines that are responsible, is it? It’s Boeing.”
One key element to overcome is helping people who have never experienced advice to understand the benefit of it, which is not easy and may be insurmountable if people are “dead set against accessing advice”, says Harrington.
