Last year, I joined the Octopus MoneyCoach team at an event they hosted in the Houses of Parliament to help MPs better understand the importance of access to money advice. One of the MPs I met told me a distressing story: someone had arrived in her constituency office with two bulging sacks of post, having just been declared bankrupt. Such was their fear of opening bills that the constituent had chosen to ignore them, letting them pile up on the mat until the bailiffs came knocking.
We all know this isn’t a logical way to act. Many of us would like to think we might behave differently if we were in a similar situation. But the reality is that, facing such a horrible event, we might all be tempted to bury our head in the sand. To me, it’s a stark illustration that our relationship with money is fundamentally broken.
At the root of our relationship woes is the emotional tug of war that money so often inspires. In the UK, 19 million people feel worried when thinking about their financial situation1. More than 40% felt overwhelmed by daily financial decisions2.
The emotion that money so often evokes is fear. Fear of the unknown. Knowledge can be a huge barrier when it comes to money. When we don’t understand something and that lack of knowledge becomes all consuming, many of us choose the easier path of avoidance. It’s highlighted by research showing that almost half of Brits lack basic financial knowledge3. It’s further demonstrated by the 11.5 million people in the UK who have less than £100 in savings4 and by the 75% of UK adults who don’t know how much is in their pension pot5.
For those who do want to seek the help of experts, they often don’t know where to turn. In part, this is about trust. Financial services has long been ranked the least trusted sector in the world, with only 54% of people saying they trust the industry6. But it’s also because much of financial services has largely innovated the humanity out of our experiences. We’ve never had access to more apps and more information, and yet millions of people are still confused about what to do with their money.
One of the biggest light bulb moments for me over my four years running Octopus Investments though, is that none of those things are true of financial advisers, who for decades have built long-term, trusted relationships with their clients and helped them tackle a great number of money-related topics.
At Octopus, we’ve learnt a huge amount from the thousands of financial advisers we’ve partnered with and championed since we first set up our investments business in 2000. Now we want to take those learnings to a different part of the market, to those who don’t have the resources, or the complex financial issues best served by traditional financial advice.
That’s why we’re launching Octopus Money, a new brand offering money coaching and advice to millions of people across the UK. Octopus Money will combine the skills of people passionate about delivering genuine help, with the efficient technology that is typical of fintech.
In launching this new proposition, we’re driven by an obsession to help everyone use money to live the life they want to live. We’ll take the best bits of robo advice, financial advice, and coaching, to deliver money advice and coaching at a cost that’s accessible to all. We’ll provide intensive support at complicated life moments, from the good – having children or moving home – to the bad; divorce, accidents and ultimately death. We’ll primarily do this through employers, to help reduce the stress their team members feel managing money.
Hopefully, along the way, we’ll make you all proud as we help people regardless of their level of wealth to get the same feeling your clients benefit from every day, and in time, see how we can work alongside you to close the advice gap for good.
1 https://moneyandpensionsservice.org.uk/2021/11/10/24-million-uk-adults-dont-feel-confident-managing-their-money-talk-money-week-is-here-to-help/
2 https://www.comparethemarket.com/media-centre/news/the-great-financial-divide/
3 https://freetrade.io/news/uk-financial-literacy-test
4 https://www.fincap.org.uk/en/articles/key-statistics-on-uk-financial-capability
5 https://www.standardlife.co.uk/about/press-releases/75-percent-of-uk-adults-dont-know-how-much-is-in-their-pension-pot
6 https://www.edelman.com/sites/g/files/aatuss191/files/2022-01/2022%20Edelman%20Trust%20Barometer%20FINAL_Jan25.pdf
