Friends and family 'are young people's financial advisers'

Young people have a “deep mistrust” of financial services and are turning to family and friends for financial advice rather than qualified advisers, research suggests.

In a survey of 137 20-30 years olds carried out by communications consultancy MRM, over half (52%) say family and friends are their biggest source of financial advice with a worrying two-thirds (63%) placing IFAs at the bottom of the list when seeking advice.

Report author Sarah O' Connell says the findings bring to light a "deep mistrust" of the financial sector by the younger generation that advisers must address.

"The next step will be to find out how financial providers can reach out to younger people to bridge the gap between young people's attitudes towards their personal financial planning and their actions to highlight what can and should be done to secure a healthy financial future," she says.

Whist MRM's research highlights a deep level of apathy towards financial advisers on behalf of the young, it also suggests this demographic is more switched on financially than they have often been given credit for.

The survey suggests the so-called "lost generation" have begun to recognise the need to save earlier and prioritise debt repayments, and are giving more thought to planning their financial future. Of those polled, 80% have a savings account and 29% pay into a pension.

A further 35% describe paying off debt as their "number one financial priority", whilst 32% feel "in control of their money and like to plan ahead".

An overwhelming 89% think people should begin to plan for the future by the age of 30.