'Taboos' around vulnerability are deterring advised clients from discussing their additional support needs with their advisers, according to St. James’s Place (SJP).

The firm noted that while financial advice had a significant role to play in mitigating the impact of vulnerability on financial decision making, preconceived notions around vulnerability put 52 per cent of clients off seeking additional advisory support.

SJP’s Real Life Advice Report highlighted both the role of financial advice in supporting clients that have characteristics of vulnerability, and the ongoing barriers and improvements the industry needs to address.

Its study of 12,000 individuals demonstrated the value of financial advice when life “becomes more challenging”, with 31 per cent of those receiving ongoing financial advice citing circumstances that can increase the risk of financial vulnerability as their main reasons for seeking support.

Overall, a quarter (25 per cent) of those receiving financial advice said it had made them feel less vulnerable, while 31 per cent felt more confident and 26 per cent felt less stressed.

Furthermore, 92 per cent of clients said that seeking advice had benefited them mentally and emotionally.

However, SJP’s report also found that reluctance to start conversations and a lack of awareness of the support available were “significant barriers”, which could be putting off others from seeking the right support.

More than half (52 per cent) of advice clients were unlikely to discuss additional support needs with their adviser, and SJP stated that continued work still needed to be done by the industry to address vulnerability.

Nearly a fifth (18 per cent) of respondents said that little additional help or support was offered when they needed it, and 15 per cent were simply directed to charities or similar organisations.

Additionally, only 14 per cent were offered additional support that they were not previously aware of, rising to 23 per cent among those receiving ongoing advice.

SJP urged the advice industry to create more debate around the language used regarding vulnerability, to share industry best practice, to embed understanding across colleagues, to harness technology to help identify and support vulnerable clients, and to build better financial resilience.

“Throughout a lifetime, many people will face events and challenges that can increase their risk of financial vulnerability,” commented SJP Vulnerable Clients Steering Group chair, Anna Blake.

“However, this doesn’t have to dictate their financial future. By seeking informed advice, prioritising mental health, and building resilience, our research shows they can navigate more difficult times with greater confidence.

“Our research highlights how we must continue to reshape the dialogue around vulnerable clients. Whilst advisers across the country have been supporting their clients through all circumstances and scenarios over many years, the industry’s understanding of vulnerability, how to identify it in the first place, and how to provide clients with appropriate support, is evolving rapidly.

“Heading this drive at SJP, I’ve seen a three-fold increase in the number of clients being identified as having characteristics of vulnerability since July 2020, and I’m sure others in the industry are seeing similar trends as we all focus on improving our understanding and strengthening the processes and approach that underpin the support we provide. But there is clearly more to do.

“As an industry we need to get better at communicating the value we can offer and come together to address our gaps, share best practice and champion our strengths. If we do so, we have an opportunity to make a real difference and demonstrate more clearly how advice is a force for good in supporting all clients at risk of vulnerability.”

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