Young adults turn to parents for financial advice

Younger adults have been told that while their mums and dads’ advice is a good starting point for making important financial decisions, they also need to tap into professional expertise.

The warning came after new research from financial products provider MetLife and unbiased.co.uk, through which consumers can find independent professional advisors, revealed that nearly half (49 per cent) of adults under 30 were relying largely on their parents to guide them through financial decisions.

The research, published on 11 May, also found that adults in their 20s were most likely to turn to their parents for financial advice.

A survey of 2,002 over-18s found that one in five (19 per cent) would supplement their parents’ advice by doing online research, rising to 33 per cent of those in their 20s.

People were most likely to seek their parents’ input on decisions about long-term financial products, including ISAs (13 per cent), savings accounts (13 per cent) and first-time-buyer mortgages (12 per cent). Only 16 per cent said they would not consult their parents about financial decisions.

Karen Barrett, chief executive of unbiased.co.uk, said: “This research shows that today’s young people are thinking about their finances more than any recent generation.

“Taking on board your parents’ experience is a good starting point, and you know they want the best for you. However, much as they would love to, most parents can’t provide the specialist insights or market knowledge that you need for such decisions.

“Our discovery of high levels of financial regret – people of all ages recognising that they’ve made poor choices in the past – should be warning enough.

“By not obtaining proper information at the time decisions are made, people risk being much worse off in the longer term. Speaking to friends and family can give you anecdotal knowledge, and searching reputable websites can broaden your understanding, but only independent professional advice can provide the vital blend of expertise combined with a focus on your best interests.”