Strategic report Governance Financial statements Other information MARKET OVERVIEW CAPTURING GROWTH IN AN ATTRACTIVE MARKET CONTINUED ISAs – HL has Structural growth drivers COVID-19 and the uncertainty it brings, has COVID-19 and the uncertainty 1.1M+ There is an estimated £314 billion gap between reinforced the importance of saving and investing it brings, has reinforced the retirement expectations and the cost of funding and the need for individuals and families to be such expectations “The Savings Gap”. The level financially resilient. This has led to a surge in importance of saving and of funding necessary to provide retirement engagement as the event has reinforced and investing and the need for accounts as at 30 June 2021 and income is increasing, driven by longer life accelerated long-term trends. Many have started £55BN+ expectancies, less generous company pensions saving and investing for the future for the first individuals and families and ambitious retirement expectations. The time, particularly millennials. For those already to be financially resilient. burden of responsibility for retirement is shifting on that journey, they have devoted more time of invested assets from government and corporates to the to investing and have been putting cash savings individual. This gap cannot be closed without they have built up across the various lockdowns individuals taking ownership for self-provision into investments and in particular into ISAs and and without the use of long-term investments SIPPs where they benefit from the valuable alongside cash savings. Hargreaves Lansdown tax breaks. Junior ISA market share and the rest of the UK Savings industry needs to help bridge this gap. The factors above mean people need help and support more than ever before. They need help Post the Retail Distribution Review (RDR) cost to understand, to manage and to do things effective advice has been increasingly difficult to simply and increasingly through digital means. find. Most advisers concentrate on wealthier Within our addressable market, there are key clients to whom they are now charging a direct segments such as adult savers, Pre-retirement fee, which has left a large advice gap particularly and Retiring which alone hold c.£900 billion. at the mass affluent end of the market. Demographics and longevity alone will provide Successive UK governments implementing growth drivers in these key segments but, if the further changes to pension savings, the UK savings gap can be better addressed, then introduction of various ISA products, the growing further impetus could be developed across these awareness of responsible investing and and other segments. Although other segments persistent low interest rates have made finding such as the very young and very old are not so Hargreaves Lansdown 37% the right solution for individuals’ investment key in terms of the opportunity, they still need Competitors 63% needs ever more complex. engagement and investment solutions and Hargreaves Lansdown, through its breadth of offering, can address them too. 20 Hargreaves Lansdown Report and Financial Statements 2021