I was interested to read recently that Insurers Aegon held a research day in London to look at how the financial services industry can better cater to the general consumer. The 50 volunteers split into five groups, each looking at one proposed model based upon the findings from Aegon Chief Executive Otto Thorensen’s report for the government.
The five proposed models to receive financial advice through are a financial guru, a financial coach, a personal shopper, drop–in centres and financial superstores. Unsurprisingly different people plumped for different options depending upon their needs. As a twenty–something female, proposals for personal trainers and shoppers particularly caught my eye…
My new–year return to my local gym prompted the personal trainer to ask if I was new, (erm no just lazy) and therefore would I like a free induction? He was really helpful and gave some great advice; however, I have since forgotten a fair chunk of it and cringe when I see him in the gym in case he sees I’m back to my hapless former ways.
The benefit of having a personal trainer is that rather than receiving one–off help and advice, which you soon forget, you get regular contact with an expert who puts together a programme specific to your particular health and fitness goals. For me discipline is the key problem: “shall I do some sit–ups…nah”; without someone there to push you it is so easy to not bother. In much the same way it is easy to develop bad financial habits: “should I buy those shoes…no but go on then, I’ll put money in the ISA next month.”
Having a financial coach who you are accountable to might make you think twice before making some rash financial decisions – or on the flipside it might encourage you to take a more active role in your financial situation and develop a plan that sees you financially fit. I like this idea a lot because it isn’t about a quick fix but about developing better financial habits.
While the idea of a personal shopper picking out clothes for me is appealing – no more traumatic changing room experiences or Saturday jostles with fellow shoppers – it would also be quite dangerous. In contrast a financial personal shopper who could help me find the best–suited financial product would be welcomed with open arms.
Personal shoppers’ services would come into play after you have decided what type of product you need (through either a guru, coach or drop–in centre) and stop the headache of comparing a huge range of choices and not knowing which product to go for. From a superficial point of view I would also enjoy casually mentioning “my personal shopper” in conversations. Although, if Aegeon’s proposals take off then perhaps having a financial personal shopper will become quite commonplace, in which case it could lose some of its kudos.
Perhaps I could consult a financial guru instead.Similar to the financial coach, a guru would help you create a financial plan specific to your own needs. Hmm… in fact I don’t really get what the difference is between a guru and a coach. Perhaps vain people hire a financial personal trainer and those in touch with their ‘spiritual’ financial side opt for a guru?
I should probably mention the other two options discussed, even if they didn’t grab my attention as much as the others. They are still ideas that many consumers would like to see developed.
Drop–in CentreIf you have a question or quibble about something but don’t want the commitment, or cost, of meeting up with someone regularly, drop–in centres are great starting points. The proposals suggest they would give generic advice and financial MOTS, without recommending specific products. When you don’t know where to start, being able to just walk into a centre is a convenient start without the pressure.
Similar to the personal shopper but without the need to meet an individual face to face or pay a fee, superstores would be accessible online and as physical retail stores. Again consumers would need to already know what type of financial product they are looking for and then the superstore would help the consumer buy the cheapest product. A bit like price comparison websites, there would be no advice but easy–to–understand information on the products.
Given that my attempts to navigate various price comparison sites haven’t always been successful, I would like to have someone go through everything with me. But for those who know what they want, having all the options together in one place to look at is extremely helpful.Go to the aegon website research page and click on phase two report to read about each concept.
Nathalie Bonney is editorial assistant at Moneywise