I recently completed a master’s degree in financial planning with the University of Gloucestershire and I wanted to understand what financial goals young adults set themselves and why they do not seek advice from an expert to help meet their goals.
The methodology was interviewing adults aged between 18 and 40; the sample was quite minimal and may not be generalisable across the wider ‘young adult’ demographic. But the aim was to provide a better understanding of the perception young adults have of the financial services industry, goals they typically set and whether they seek advice from a financial expert (based on the individuals that were interviewed).
The perception of the financial services industry was investigated amongst the interviewees, with more than half of them feeling that they are not suitable individuals to receive financial advice from an expert. Many of them perceived that financial advice was for the ‘wealthy, older generation’. When questioned further as to who they believe financial advice was for, they acknowledged it was for everyone.
Therefore, the perception of the financial services industry versus what they actually believe to be true with regard to who can benefit from financial advice is completely different.
It is clear from the research undertaken that young adults do set themselves financial goals, with the most common ‘milestone goal’ being a house purchase. Other goals were also identified, but related to more imminent requirements, such as saving for a holiday or a car.
What was acknowledged during the research was that although goals were identified, more than half of the interviewees did not have a plan in place to reach their goals specifically.
With some goals being identified, it was still not clear why young adults do not seek advice from an expert, so that there is help and support with implementing a plan to help reach the goals set. This is especially true if they believe financial advice should be for everyone, despite their perceptions being contrary to belief.
During the interview process, it was highlighted that there is a lot of information available online and on social media, which the interviewees felt comfortable accessing and then making financial decisions based on what they have seen and/or read – with Martin Lewis being highlighted as particularly useful in terms of information he provides via his website and emails.
But some of the interviewees also acknowledged the information accessed is relatively generic and they struggled to understand or apply what was found to their own circumstances and, as such, would value a further conversation with an expert to cement understanding.
From the research undertaken it was clear we are now living in a world where there is a growing online presence from individuals on YouTube or TikTok providing financial information; advice on financial matters that individuals do adhere to, but it is not clear how reliable and valid this information is.
Given the degree of regulation that apply to financial services, which have increased over the years, should online information be subject to regulation? It certainly brings into question who is considered an expert and what makes them trustworthy.
