The global coronavirus pandemic has caused many people to re-evaluate what’s important to them, and research by UBS suggests that this has carried through into the way that people wish to invest their money.
In their report published in June, UBS highlights their research into the attitudes of investors, and how these have changed following the pandemic. Although primarily aimed at American investors, the survey is based on responses from clients around the world. What it reveals is that the pandemic has made more people aware that life is short, and they want to make up for the missed time.
A typical comment was “There are so many things I want to do before I die. Now that time is shorter than before it’s natural to want to make up for them.”
As a result, 4 out of 5 of those investors have re-evaluated their goals due to Covid, and over two-thirds want to make more of a difference in life.
Forty percent want to retire earlier and enjoy life more, significantly up from a year ago.
Most of the respondents (93%) agreed that they felt appreciative of what they have, but
two-thirds also felt a sense of guilt for being more fortunate than many people. 45% of them expect to give more to good causes than they did before.
The way that people invest is also changing. Fully 90% of respondents agreed that they want to align their investments with their values, and 59% were interested in sustainable investing and the impact that their money has on the world. It was interesting to note that there are significant generational differences in these views, with 80% of younger investors (under 50's) wanting to make more of a difference in the world, compared to half of the investors aged over 50. More of these younger investors (52%) also plan to give money to charity than their older cohorts (35%).
Hungry for Advice
Younger investors are also hungry for advice, with three-quarters keen to develop a comprehensive financial plan compared to only 40% of over 50's. But most investors agreed that life experiences are more important than material things and that they plan to spend more money on travel, dining out and social experiences than before Covid reared its head.
Values-Based Advice
The implications for financial planners and wealth managers in these results is clear. Advisers need to fully understand their client's values and goals and to revisit them regularly as an individual’s life experiences unfold. They need to be able to suggest appropriate strategies for giving and philanthropy, and they need to take into account investor's views with regard to the sustainability of investment funds and their impact on the planet.
Advisers also need to be aware that views differ amongst generations, and that their client's wants and needs are likely to mature and change over time, and that the values of current generations may not be reflected in the views of the citizens of tomorrow.
What is encouraging for us at Woodgate Financial Planning is that those advisers who get it right, by being able to deliver a values-based, professional long-term relationship based on advice that connects intimately with clients' views, have a bright future ahead of them. For our part, we continue to work diligently to create individual financial plans that not only inspire our clients but give them the tools to achieve their goals.
Have your views changed as a result of the pandemic? Drop us a line and let us know.