Respondents were asked to agree or disagree with the statement “Until now, I thought financial planning was all about money, not about setting goals”. Of those polled only 38% agreed and 62% disagreed.
So, if the results are to be believed at least a significant element of the population is beginning to buy in to the concept and importance of broader, goals-based financial planning. As Tim Page, Certified Financ
ial Planner (CFP) at Financial Planning firm Page Russell commented, “Money is simply a tool to help us lead our lives; because we financial professionals deal with the technical aspects of money every day, it’s sometimes easy for us to forget this. I’m so glad that most of those polled agreed with me that there’s more to financial planning than just the money.”
“This is an interesting result” says Jane Wheeler CFP, Principal of Direction Financial Planning and President of the IFP. “Monday’s Daily Poll result conflicts somewhat with the results of the IFP Financial Planning survey carried out by YouGov in August. That study showed that although 93% of people admit to worrying about their financial future only 26% make the effort to identify the financial priorities and life goals and act accordingly to achieve them. It showed that almost 50% of people have not drawn up a financial plan. This showed us that large numbers of people in the UK need to start to take their financial position more seriously in order to avoid future financial disaster.
If the results of yesterday’s poll are representative, it is encouraging to see that at least some people have recognized the importance of working out what they want from life, although it is possible that, being the very first day of Financial Planning Week, the responses were from those who may already be more engaged with the process of planning their finances. It will be interesting to see how they respond to the remaining questions throughout Financial Planning Week to see if they are then making the appropriate plans to achieve those all important goals.
Julie Lord, Certified Financial Planner with Cavendish Financial Management Ltd, was similarly encouraged by the result, observing that, ”Planning for the lifestyle you have always wanted has got to involve the proper organisation of the right resources, financial or otherwise. Being able to articulate and/or formulate goals with the assistance of a trained professional is critical to your success.”
Steve Gazzard, Project Manager of Financial Planning Week at the IFP comments: “I am pleased to see that coverage to date we have already impacted 38% of peoples thinking as they have understood that financial planning is a process that starts with setting goals.If we combine this with the data from the survey…. ‘93% of people admit to worrying about their financial future yet only 26% make the effort to identify priorities and life goals and act accordingly to achieve them’ then the difference between these is the ‘financial planning gap’ i.e. the difference between those who think/worry about the future and yet don’t do anything about it.
The first step is to get clear on goals and the poll shows that already over a third of people understand they need to set goals which is great news! For the vast majority then, whilst they are worried about their future, there is little evidence to suggest that this is causing them to actively plan for their future. Financial Planning Week is all about giving people a trusted process they can engage in.”
Nonetheless, there should be no room for complacency. What the poll doesn’t capture is, first why almost one third of respondents remain to be convinced about the benefits of setting goals and planning to achieve them, and second, what proportion of the 68% majority are making active planning decisions now, or even thinking about doing something in the future.
Morningstar is running a poll each day during Financial Planning Week. Take Tuesday's poll now.
As part of Financial Planning Week, Morningstar is creating a special library of content that can be reprinted on your Web site at no charge. Contact us for more details and permission.
