The Good, Bad and Ugly of DIY Financial Advice

Financial regulations are always put in place with the intention of lending further transparency to decision making processes. However, the eventual results do not always mirror the initial vision. Although providing a new breed of qualified investment advice may help investors avoid financial pitfalls, many individuals are now distancing themselves from this prepaid and often times still confusing arena. The end result has been that markedly fewer people are seeking the services of a financial adviser; indeed, less than one-third of all adults will consult these professionals.

Although some analysts will state the a reduction in the number of professional advisers is one of the goals of many regulatory authorities, others will feel that the do-it-yourself tendency being witnessed may usher in dire consequences for those inexperienced in the financial industry. Is this a future financial debacle waiting to unfold?

Another effect that this shift has had is in the way financial companies now communicate with potential clients. Unsurprisingly, many professionals are now learning to embrace the internet as a means to drive business forward and to disseminate their services. It seems that online execution-only platforms may be the way forward. In fact, the investment giant Hargreaves Lansdown now boasts a website that attracts more visitors in the United Kingdom than The Times or the Post Office. They have also adopted an iPad version of their newsletter and cater to thousands of Twitter followers each month.

Additionally, it should come as no surprise that garnering investment advice from social media sites has also increased in popularity in recent times. Many of those who follow the do-it-yourself mentality will utilise the knowledge base of the larger, interactive populace to help shape their financial decisions. Although this methodology is still in its infancy, some feel that the purchase of equities and deciding upon the correct investment fund may be the next logical step forward in the social media arena.

It is obvious that financial companies and fund managers need to quickly adapt to a generation increasingly focused on mobile devices, business apps and real-time flexibility. No longer does this approach represent but a small portion of investors; rather this will be considered the norm in the relatively near future.

So, while the landscape of financial advice may be changing dramatically, the ability to acquire sound and secure advice is more important than ever before. While companies continue to modify their practices to accommodate this growing trend, individuals need to avoid the pitfalls often times associated with such a malleable environment.

Tim Aldiss writes on behalf of Broadgate Mainland, the financial services PR experts.

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4 thoughts on “The Good, Bad and Ugly of DIY Financial Advice

  1. Michelle

    I think it’s nice that there are so many bloggers and PF gurus on Twitter, but I agree, individuals should be making sound and wise decisions.

    Reply
  2. Hannah

    The key to sound investment is to avoid financial pitfalls and I agree hiring a professional financial adviser will be a wise and a calculative decision for a secure future. DIY financial advice is good as long as it’s reaping positive results and one is a professional in this area.

    Reply
  3. Debt Snowball Calculator

    The key to sound investment is to avoid financial pitfalls and I agree hiring a professional financial adviser will be a wise and a calculative decision for a secure future. DIY financial advice is good as long as it’s reaping positive results and one is a professional in this area.

    Reply
  4. Pingback: 5 Potential Pitfalls of Property Investment

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