Independent financial advisers believe 35% of their clients could be classed as vulnerable.
This is according to an AKG report sponsored by Standard Life, which also found 31% of those with vulnerable relatives who have made poor financial decisions attributed this to not having access to financial advice or guidance.
Another 37% said relatives making poor financial decisions was due to lack of knowledge or understanding.
Almost half (45%) of UK adults are concerned about the financial decision-making of their vulnerable relatives as they get older.
Additionally, 10% said relatives made poor financial decisions in the past two years, which resulted in financial loss.
However, 49% are apprehensive about their own financial decision-making capabilities and 14% are concerned about their financial decision-making as they approach retirement.
Standard Life retail intermediary managing director Chris Hudson said: “People are naturally always concerned for the wellbeing of their vulnerable relatives, particularly when it comes to financial decision-making which can be confusing and easy to get wrong at any stage of your life.
“The ongoing cost of living crisis has amplified the UK’s problem with low financial awareness and understanding, with people often more likely to make risky decisions when they are struggling.
“For example, there can be a strong temptation to use long-term savings to cover day-to-day costs. As a result, many people, particularly the more vulnerable, are at risk of making poor financial decisions and could become easy targets for scammers. We urge people not to struggle alone – speaking to a financial adviser or accessing financial guidance and education can be invaluable throughout life.
“The fact that financial advisers consider over a third of those who do seek advice to be vulnerable is telling – it’s scary to think how many people who are not advised could fall into this category.
“A collective response from providers, regulators, government, and advisers is needed to help people access advice and empower and educate clients. Crucially, the industry as a whole needs to invest in vulnerability programmes and make sure it’s providing the flexibility needed to treat vulnerable people well.”
The report was based on Opinium Research survey of 2,000 UK adults in February 2023 and a Pureprofile survey of 100 financial advisers on behalf of AKG.
Standard Life is part of Phoenix Group.
