Clients need good advice to beat inflation!

Clients need good advice to beat inflation!

The need for a good Financial Advisor is incredibly evident during times of economic turmoil and increased inflation! Financial Advisors are invaluable not just for their financial expertise, but also for their steady hand and wealth of experience. As the impact of inflation persists and the cost of living remains high, it is becoming increasingly important for investors to consider their long-term financial planning and seek the wisdom of experienced Financial Advisors. 

Increasing Client Confidence – The Need for a Financial Advisor

Although investors have prevailing concerns about continued economic difficulty, according to the Scottish Widows Investor Confidence Barometer, 34% of advised clients believe their biggest mistake over the last 12 months was ‘taking too little risk’. This figure has increased since the previous barometer, suggesting a shift in attitude amongst investors. Although economic uncertainty has affected investor confidence, with 72% of clients contacting their Advisor to discuss market volatility in the last 12 months, the uptick in this figure indicates a realisation among investors that they have been overly defensive. As investors begin to recover their confidence, the expertise of a Financial Advisor becomes invaluable to ensure clients get back on track with their financial and investment goals. 

The Effect of Inflation – Attractive Cash Return Rates

The current return rates on cash are highly attractive with many fixed-rate accounts offering over 5%. Throughout 2023, households continually moved money into these higher interest time deposit accounts as shown in the Bank of England November 2023 Money and Credit statistics. Although this may be the best option for some, many clients are likely being swayed by these attractive rates and potentially acting without considering the long-term implications of cash savings and inflation. As all good Financial Advisors know, high inflation might drive up return rates however it can also quickly erode the spending power of money, ultimately reducing its value. 

Equity Investment – Long-Term over Short-Term

Compared to cash saving, equity investment may seem to be a more intimidating option for your clients. Though it is true that equity is subject to the whims of the market, historically it has outperformed cash savings in the long term. Returns on equity investments have a much better chance at beating inflation, ensuring the value of your client’s money is maintained regardless of any further economic turmoil. Your client’s emotional response to equity investment might prevent them from making decisions that are in their best interest. The role of a Financial Advisor is crucial to ensure clients are acting with their goals in mind and making practical, well-considered decisions that offer them the best opportunity to achieve their desired returns. 

Money over time

The Value of an Advisor

Clients can be heavily influenced by external factors, with almost a quarter of advised investors and over a third of non-advisor investors admitting to being too influenced by the news when making investment decision. The role of a Financial Advisor is to ensure that clients are acting in their best interests and not making impulsive choices based on currently attractive factors that may not benefit them in the long term. Advised clients benefit hugely from the wealth of experience and expertise provided to them by their Financial Advisor. Your ability to look through the current fads and consider your clients personal goals and circumstances is invaluable. In times of high inflation, investors need a good Advisor more than ever to ensure they are getting the best returns possible and continually working towards their investment goals, regardless of economic uncertainty. 


As investor confidence returns despite continued high inflation, the role of a Financial Advisor has never been more crucial! Ensuring your clients are not seduced by attractive cash returns without considering the long-term effects of inflation is key to keep their financial goals on track. Every investors situation is different, therefore the wealth of knowledge and expertise provided by a Financial Advisor is incredibly valuable for clients to beat economic turmoil and inflation!

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