Advisers

The demand for professional and experienced financial advice has never been greater than it is today. And, whether or not it is delivered face to face and/or online, somethings seems to be certain.

Demand can only increase for the foreseeable future. Why? Because pension fund “freedom” coupled with pension premium restrictions has created a very complex regulatory environment that is chock full of challenges and opportunities.

There are about 22,000 advisers who are equipped to meet this demand. And this number is unlikely to increase any time soon. So, as demand increases fees will also rise. This is excellent news for the profession. Even better news is that the investable assets in the hands of the aged 50-70 segment is about £1trn. No wonder so many people are trying to buy into these people!

The spanner in the works is the potential DB to DC “scandal”. Because, even where the advice is seen to be satisfactory, a three year bear market will have a very dramatic impact on those well thought through plans. And not all advice is considered satisfactory.  In a statement in January the FCA stated that their recent research suggested that across all products 93% of advice was considered suitable but only 50% was suitable when it related to pensions transfers.

Consolidation within this market will increase for the foreseeable future. Private Equity and institutions will lead the charge and pay more than most firms are worth