Can financial advice impact financial wellbeing?

• Context
• The study
• Key findings
• Points to consider

Context

For people to be able to manage their finances effectively and plan for the future, it is important that they understand their finances. This report looks whether financial advice plays a role in helping people attain financial wellbeing, and the mechanisms through which that might happen.

The study

The research was conducted by YouGov, an independent research agency in December 2019, and comprised online surveys with 2,000 employees. The data was weighted to be representative of British business size. The survey was commissioned by Aegon, a provider of financial services and advice and founding member of the Initiative for Financial Wellbeing.

Key findings

The authors stated the following:

• Enjoyment from life: The survey found that those who had taken financial advice were more likely to be enjoying life because of the way they are managing their money.
• Future proofing: Those who had taken advice were more likely to agree that they are doing everything to secure their financial future.
• Financial resilience: Those who had taken advice were more likely to be able to financially handle a major expense.
• Challenging ones financial situation: Those who had taken not taken advice were more likely to believe that they will never get the things they want in life.
• Productivity: Those who had not taken advice were more likely to be distracted at work by worrying about money.

There was no indication as to whether these differences were statistically significant.

Points to consider

• Methodological strengths/weaknesses: There is only limited information on the methodology. The authors state that the survey is representative of British businesses by size, but there are no other sampling criteria, weighting criteria, or information about statistical significance.
  • There may be other causal factors which might create a correlation between those who have taken financial advice and the indicators of financial wellbeing used in the report.
• Generalisability/ transferability: The data relates to working age people in Britain, but it is likely that results would be transferrable to other countries
• Relevance: The report discusses financial advice and financial wellbeing, both important topics.
  • Applicable to those seeking or providing financial advice, or those with an interest in financial wellbeing