Ambiguity regarding wealth management and the terminology used in the financial planning sector means that many people are missing out on savings and investments that could benefit them. Experts believe it is high time this sector is demystified to enable wider groups of people to make more informed financial decisions.
One of the biggest areas of ambiguity in the financial sector is pensions. According to the Sun, one-fifth of Brits aged between 46 and 51 do not have a retirement fund, while 85 per cent of the people surveyed do not really understand how pensions work.
With many of us living longer, failure to put a pension in place for later in life can mean that we do not have enough money to live on in our advanced years.
Lack of trust
It is not just the mystery of pensions that many people find baffling; lots of us simply do not trust the institutions investing our money. The recent financial crash has left a bitter taste in the mouths of savers, causing many people to shy away from setting up a nest egg.
A need for education
This lack of awareness and trust in the financial sector means that many people are missing out. It is often the ordinary person who could make better use of financial advice to grow their money, rather than just the rich.
The problem is that many ordinary people are confused by the terminology used in wealth management and believe it is an area confined to those with a bulging bank balance.
Financial institutions need to get the message across to wider audiences that financial planning is something for everyone, no matter how wealthy they are. This should begin with demystifying some of the common terminology used, making it simpler for everyone to understand.
Institutions should invest in a wider range of back office systems for financial advisers, such as those offered by https://www.intelliflo.com/, to enable them to make their products more transparent, accessible, and easier to understand for everyone.
A more current approach to providing financial data, such as offering digital information, will ensure customers are kept in the loop when it comes to understanding what is happening with their finances. This instils trust in customers and solves the issue of educating people and increasing awareness of processes within the financial sector.