Widespread speculation about potential tax and pension allowance changes ahead of the Chancellor’s 26th November Budget is fuelling anxiety among clients, with many seeking reassurance from their advisers, according to research from Royal London.
The findings, taken from the insurer’s annual Meaning of Value study conducted with consultancy the Lang Cat, revealed that 81% of advisers have seen heightened concern among clients, with 16% warning that some have been “spooked” into making irreversible financial decisions.
Only 3% said their clients were unaware of the current speculation.
While most advisers were encouraging clients to focus on long-term plans, the report showed that many are devoting additional time to managing client emotions and countering misinformation.
Two in five (40%) advisers were proactively reminding clients to stay focused on their financial goals, while 30% said they are choosing to ignore market noise and respond to client queries only when raised.
A further 16% said they were taking a more personalised approach, contacting clients directly to offer reassurance about the robustness of their plans, and 9% said they are monitoring developments closely and may make pre-emptive adjustments if necessary.
Eight in 10 advisers said the level of speculation and uncertainty this year has created unnecessary panic, prompting a rise in client calls and messages.
Another 16% said the situation had been actively harmful, with some clients taking premature or potentially damaging actions that could affect their long-term financial position.
Jamie Jenkins, director of policy at Royal London, said: “It’s clear that when it comes to financial advice, managing client anxiety comes with the territory and is a key element of the value delivered by advisers.
“It also underlines the value advisers bring by guiding clients through uncertainty, reinforcing the value of steady, long-term planning.
“The research highlights the variety of responses from advisers, with some proactively reassuring clients, others only responding when approached, and a minority considering making pre-emptive adjustments to financial plans.
“While the majority see only a limited rise in client concern, it’s telling that speculation this year is prompting real distress among some clients — with some potentially taking harmful actions ahead of any announcement.”
