IFAs around the world report as many as three out of five of their clients have a retirement funding gap. The largest has been noted by IFAs based in Singapore who say that 65% of their clients have a gap between how much they are saving and what they will actually need to fund their retirement.
The latest findings from Skandia International’s Adviser Confidence Barometer research, shows that in the current economic climate nearly half (43.6%) of advisers say their clients have become increasingly risk averse - notably over the last quarter - which in turn meant IFAs say there is a marked lower demand for new investments.
What’s frustrating the majority of international IFAs is an awareness that while the number of clients with a retirement funding gap is high, they believe their clients are in a position to save but other factors stop them from doing so. A quarter of the respondents report that clients have left savings too late in life, and more than a fifth (21.7%) feel their clients don’t have a clear enough picture of how much they need to save now in order to fund their retirement.
Marketing Manager, Phil Oxenham, says these latest results from Skandia International’s offshore adviser confidence barometer is a worrying development. “It appears most clients are able to save but are unaware of just how much money they need to save now to fund their retirement later on. As a result, customers postpone saving altogether – and the delay will have a significant impact on the amount they would be able to accrue for retirement. This, coupled with the continued drop in investor confidence and the fall in investment levels, signals a real and urgent need for financial advice to help clients develop a better understanding of the long term nature of investment.”
The research was conducted in Q1 2012 with responses from 445 advisers based in Hong Kong, Singapore, Dubai, UK, Europe, Africa and Latin America
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