Vulnerable Customers... and a Christmas Competition
1 Dec, 2022
As we power into Christmas (and no we haven’t put on lights or started playing carols yet because it’s STILL ONLY NOVEMBER!! #grumpy) we have 3 baubles to put on your knowledge tree. One of which is an invite to our bumper Christmas quiz to anoint the DIY Investor Boffin of the Year. Read more about our live webinar here.
Unless you have been at the North Pole, Consumer Duty will have occupied some of your thoughts, and for many readers, pretty much all of your thoughts. At Boring Money we have been supporting the industry to understand customers for the last 5 years. And our growing quantitative data coupled with our own proprietary panel (‘the Boring Money Army’) gives us access to insights which help us to support clients with independent metrics and benchmarking. Coupled with document testing.
We’re launching new products and services to help the industry to understand and benchmark what their customers think, with a special focus on vulnerable customers.
1. Vulnerable Customers
We publish a new report on this next week – 29th November – and I have been surprised by the findings. Of the 16.2 million investors in the UK, 34% display at least one of the characteristics of vulnerability as described by the FCA.
Younger and less affluent people are unsurprisingly over-represented but we can also see that vulnerability spikes up in women aged 65 and above.
Confidence, followed by health then financial vulnerability are the largest contributors.
I’m reminded yet again about how much we all over-emphasise knowledge and understanding. 15% of vulnerable investors report holding funds and 12% say they hold investment trusts. But 43% aren’t sure whether they have shares, bonds, funds or trusts. And if we dig into an asset class level, vulnerable investors are much less likely to hold global equity funds, but more likely to hold ethical funds.
A final interesting thought – vulnerable investors are more likely to describe their investment portfolio as risk category 1 or 2 out of 5. 25% report this compared to 19% of non-vulnerable investors. This raises the debate of how to best manage customers' long-term savings in a responsible and appropriate manner. And to enable good understanding of this most fundamental of decisions about how much risk to take.
We share more details on this report here or please talk to us about what you need. For larger brands we can map your customer data to our vulnerable customer data and give you quantitative inputs into sizing and estimating the vulnerable customers which you have.
2. Understanding and evidencing Value
We have been tracking this for large asset managers for over 3 years now. We have learnt that expectations and judgements differ based on the gender, age and confidence of investors. And we know that value is more than just performance and price.
We are now tracking this for platforms and distributors too. Amongst investors, Vanguard is known for its low-charges and the group scores well across the board, particularly in the value category. Hargreaves Lansdown’s reviews suggest investors are aware of its relatively expensive charges but value the service and experience sufficiently to continue using it. It’s horses for courses and one size does not fit all – value of course is subjective.
3. Boring Money's Bumper 2022 Sector Review and DIY Investor Quiz
On 8th December at 9am we are reviewing the year just gone, and looking to the year ahead. Trends, changes, tech, regulation, sentiment, products – it’s all included in our last webinar of the year which is designed to inform and update anyone working in wealth, investments or pensions.
We’ll be sharing our Executive Summary of the year and hosting the quiz to crown the DIY Investor Boffin of the Year.
Join us to brush up your knowledge, and for your chance to win the award, reach the pinnacle of your professional career, impress your boss and dazzle your friends.
