The vulnerability issue
Vital as it is to demonstrate compliance with the regulations on protecting vulnerable clients, writes Gary Kershaw, the FCA's guidelines really only formalise the warning signs advisers should be adept at reading.
If you’ve read Ken Davy’s thoughts on the FCA’s recent paper, “The Ageing Population and Financial Services", you’ll be more than aware of the reasons why the elderly are the most recent group to be classified as ‘vulnerable’, and I won’t attempt to summarised Ken’s thoughtful and comprehensive piece here. If you’ve read the regulator’s paper yourself, you’ll understand just how serious the problems our ageing population faces are, and the scale of societal and economic impact we could all see as a result. Most worryingly, the dual factors of people living longer and being able to access their pension funds earlier have created an imperfect storm which is not going away anytime soon.
We’ve also seen a spotlight shone on various other groups which can be classed as vulnerable; those with low levels of financial literacy and mental health issues. In October, the FCA’s Andrew Bailey also voiced his concerns about the financial vulnerability of young people with the number of 18 to 34 year-olds becoming insolvent having jumped by nearly a third between 2015 and 2016 and significantly increased numbers of young people entering indebtedness just to cover day-to-day living expenses.
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