BR Report 2019

43 42 ADVISER SURVEY ANALYSIS WHAT ADVISERS THINK This survey was conducted over a period of three weeks from the end of March to mid-April 2019 with the intention of giving a window into the current opinions of advisers in this market. We had 58 responses and are very grateful to all of those who participated. Their answers provide valuable insights, although it’s worth remembering that many of those we reach out to are already involved in tax efficient investments to some degree. There is a broader range this year of average age groups to whom advisers (who use BR) recommend BR. A small number of advisers now recommend BR to clients whose average ages are 85 to 95 and 45 to 55. This indicates not only a shift towards recommending BR at an earlier age, but also at a later age and highlights the versatility of the relief. 50-75% 25-50% LESS THAN 10% 10-25% Since 2018, the number of respondents who said BR was suitable for 10% - 25% of their client base has climbed from 38% to 43%. This is largely attributable to a drop in the number who said BR was suitable for 25% to 50% of their client base. These two groups make up over two thirds of respondents, an unexpected drop of just over 3% from last year as we would expect to see the percentages increase as the UK population continues to age. There is, however, a small increase in the percentage stating that BR is suitable for 50% to 75% of their clients. We speculate that current conditions have heavily influenced these results. Last year Compliance and due diligence was the main concern, whereas this year it doesn’t register at all. Instead, Lack of liquidity appears in well over half of advisers top three concerns - an 11% increase since 2018. Investment risk has also jumped from just under 43% to almost 55%. Exit risk, which stood in fifth position last year has moved up to third. The proportion of advisers who place concerns like suitability and HMRC challenge in their top three has almost halved. So tangible, performance related issues are most important for advisers. WHAT ARE YOUR TOP 3 CRITERIA WHEN SELECTING A BR INVESTMENT? WHAT ARE YOUR TOP 3 CONCERNS WHEN SELECTING A BR INVESTMENT? Performance history 62% 56% Provider reputation 73% Transparency off underlying assets 53% Investment process 24% Previous experience with provider 25% Third party reviews 7% Other Market research / Adviser survey analysis DO YOU RECOMMEND BR TO YOUR CLIENTS WHAT IS YOUR AVERAGE CLIENT AGE? 45-55 55-65 65-75 75-85 85-95 11% 4% 2% 45% 38% The proportion of advisers using BR and the frequency that they use it has remained remarkably similar to our survey results of last year. It’s interesting to note that, of the three advisers who reported never using BR, two see their use of BR increasing in the next two years. FREQUENTLY 31% SOMETIMES 64% NEVER 5% FOR WHAT PERCENTAGE OF YOUR CLIENT BASE IS BR SUITABLE? There has been no change to the order of importance attached to each of these criteria since last year, although Performance history and Provider reputation have both been identified by more advisers as one of their top three criteria. The most striking result though, is for Third party reviews. Only a quarter of advisers now place this in their top three criteria, compared to just under 43% last year. Perhaps in the current context of volatility and unpredictability advisers are valuing the experience of BR managers more highly. 9% 24% 24% 44% LACK OF LIQUIDITY 56% INVESTMENT RISK 55% EXIT RISK 38% LACK OF TRANSPARENCY 35% NO TRACK RECORD 29% SUITABILITY 16% HMRC CHALLENGE 16% COMPLIANCE AND DUE DILIGENCE 0% SECTOR REPUTATION 0%