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Make financial advice available to all, CEO tells Government

Sep 25, 2008

How easy is it
to get decent financial guidance these days?

We’ve all noticed how quickly money products are changing. At Money Hospital, it’s amazing how much there is to keep up with. This year’s volatile
markets have led to a bewildering array of changes from one month to the next.

No wonder it’s hard to know what to do for the best at any one time!

That’s why the boss of Aegon UK, a large Edinburgh-based financial services company, this week challenged Gordon Brown’s government to make financial advice more available for the British public, as part of its response to the current turbulence in the market.

Otto Thoresen, speaking at the Labour Party conference, told delegates that the problem is we simply don’t know where to look for help:

“People from all walks of life are looking for advice, help and guidance to calm their fears and address their concerns.

It’s time to make wider access to professional financial advice a key part of the government’s response to the current crisis.”

The government seems to agree with him. Earlier this year it approved a National Money Guidance Service, which should be trialled by the FSA in certain parts of the country next year.

If this service goes ahead, it should:

  • provide free financial guidance to all kinds of people and families
  • help people know where to go to get impartial help on all their money issues
  • be accessible through a variety of channels: the Internet, over the phone, and with face-to-face advice.

Yvette Cooper, Chief Secretary to the Treasury explained:

“It could be working out credit card repayments, budgeting for a new baby, or planning for retirement – people have to make serious financial decisions at every stage of their lives. Getting some free, independent and trusted guidance can make all the difference. It could also help prevent people getting ripped off by loan sharks or caught out by the small print on a dodgy financial deal.”

“The Government already offers free debt advice for those with serious financial problems. But plenty of ordinary families could also do with some free money guidance at many points in their lives.”

Now from our point of view this looks like good news if the trial proves successful. Because hopefully, it won’t just mean help in a crisis – but will lead to better planning, budgeting and investing for millions of normal people.

However, it won’t extend to particular product advice. For example: government-sponsored advice won’t go as far as recommending you a particular mortgage, for example, or giving you a rundown of the market leading credit cards. That’s something you’d still need to use a professional adviser for.

But with money worries overtaking a lot of people right now, the new service is clearly aimed at helping people avoid financial hot water in the future, through better planning (and knowing where to turn if in doubt). What do you think?

5 Responses to “Make financial advice available to all, CEO tells Government”

  1. Lisa R Says:
    Sep 26, 2008 at 2:34 pm

    Will the government also be offering help to people who, through no fault of their own, are persecuted and charged through the neck by the Student Loans Company? Why are they not subject to the same playing field as every other creditor – even if I bankrupt myself they will not leave me alone.

  2. Bob Says:
    Sep 26, 2008 at 5:15 pm

    I rather think it would be appropriate for the government’s financial advice to be extended to the financial services community. That entire profession has been shown to lack the expertise to value debt, to act impartially, to maintain confidence in their profession, to manage their business profitably, to maintain business liquidity, to report their company accounts with integrity and with certainty we can claim to care not a jot about their customers.

  3. Will Scott Says:
    Sep 29, 2008 at 8:58 am

    Why is there no mention of just visiting an independent financial adviser on this whole article?? I have been a financial adviser for 14 years and have helped thousands of families over this period of time. Professional, trustworthy, honest financial advisers are out their. They will explain things to you in lamens terms and give you the best financial advice available. This saves you attempting to read and understand difficult government written documentation and also trawling through websites who are by no means independent. Go seek independent financial advisers is the answer to all of this.

  4. Mark @ Money Hospital Says:
    Sep 29, 2008 at 11:48 am

    Will — good point. I’ve slightly updated the article following your comment. I made the mistake of assuming that was obvious. The government’s scheme would not replace independent financial advice, but would perhaps fill the gap between professional advisers and the word on the street.

    If nothing else, it would help raise awareness that people can go to an adviser, and that professional advice is not just for investors / the well-off but for anyone who wants to mortgage, borrow, save or budget.

  5. Chaloner Chute Says:
    Sep 30, 2008 at 8:48 am

    I have just tuned to this excellent site – well done, lots of excellent advice and comment relating to these turbulent times.

    On the top subject of managing our finances & debt, while there is plemty of advice out there for families and businesses, I have yet to see a generally available/accessible info for our beloved student population!I have been steadily trying to persuade organisations, and one Bank, to help develop a Students Financial advice guide/ package with CD and helpful budgeting tools. And critically , to finance the pack through NUS/Uni offices as a give away freebie at Freshers week sessions. You would have thought they would bite my arm off for some superb publicity/sponsorship deal, but the one main bank, after expressing serious interest said they couldn’t budget for such a programme this year…£30-£40k production costs to market to thousands of students with professional branding.

    My aim is/was simple: to financially educate students in the art of money and managing their ever-increasing debt, as well as How to budget sensibly, which included making some quite tough lifestyle choices.

    I live in hope that someone will pick this upo and run with it…meanwhile I shall enjoy this forum. I am not a financial advisor, just an ex-teacher and project manager.

    Chaloner

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