A mere quarter of savers proactively consult an adviser about their options, according to a survey that found two fifths had experienced a drop in their savings in recent years.
Research from FJP Investment, published yesterday, found that out of 2,000 consumers, only 26 per cent said they would use an adviser for help.
This trend could be detrimental as the survey found almost two in three (59 per cent) had chosen to hold their money in a savings account rather than invest it, as they believed this to be the most secure option.
But Jamie Johnson, chief executive officer of FJP Investment, said there were signs things were changing for the better.
He said: “Whilst many still value security offered by savings accounts, we are starting to see more people challenge personal finance norms, demanding further advice from banks and proactively seeking consultation from financial advisers.”
The research found savers were increasingly seeking alternative options to the traditional savings account, with almost one in five (18 per cent) switching from the traditional high street bank to a challenger bank, such as Monzo.
But the survey also found almost half (48 per cent) of respondents found investing in stocks and shares or property too risky in the current environment, and many were putting off making important financial decisions until after the UK leaves the EU.
Perhaps as a result, two fifths (38 per cent) have seen the value of their savings decline in the past twelve months, with individuals holding an average of £18,469 in savings.
Ivor Harper, director at advice company Park Financial Limited, said: “People may hold money on deposit for a number of valid reasons. For example, to cover an expected short-term expense (new car, impending tax bill etc) or simply as an emergency access fund to cover unexpected outlays (boiler breakdown, new roof required).
“However, many people have sums in bank accounts that far exceed any possible contingency planning requirement.
“This may be due to apathy – they have always saved that way and have never got around to looking at alternatives, fear – they believe that leaving the safe harbour of their savings account will expose them to investment risk and financial naivety – they simply do not appreciate what alternatives might exist for them.”
But he warned that people were eroding their savings year after year by keeping tens of thousands of pounds in these types of accounts.
Mr Harper added: “A good professional adviser can help overcome all three of the above blockages by providing the incentive to act, reassuring the saver about the level of risks involved and educating the saver as to the full range of options and, perhaps providing a spread across different low-risk products (including higher-interest-paying deposit options) to work out which mix of options best matches the individual’s tolerance of risk.”
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