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Financial Advisers: Yesterday's Heroes in a Commoditised Market

Let's start with the cold, hard facts. The advice gap is widening faster than a politician's smile during election season. According to YouGov as reported by Citywire, only 9% of consumers are paying for financial advice, down from 11%. And why? More than half of advisers are turning away clients with lower assets, thanks to the consumer duty that's supposed to help, but in reality, just drowns them in paperwork. This isn't a minor issue—four-fifths of advisers say it's now harder to service more clients.

Financial advisers are abandoning ship, sticking with their 100 wealthiest clients who have more assets than a billionaire on a yacht. But why cling to this sinking ship of financial advice, a.k.a. product intermediation? This market is so commoditised it’s practically an aisle in Tesco. The days of advisers promising market-beating returns are over. All they deliver is market returns minus their fees. Revolutionary.

Financial Advice vs. Financial Planning

Here's the kicker: financial advice and financial planning are not the same beasts. Financial advice is regulated by the FCA because it's about product distribution. It's pushing products, claiming to know which investment will make you rich. Spoiler alert: it's none of them. Financial planning, on the other hand, is a different animal. It's not about selling products; it’s about adding real value by helping people plan their financial futures. And guess what? It doesn't require FCA regulation.

So where's this heading? Well, eventually, advisers will raise their thresholds of investable assets above £500,000. Abracadabra, their customers are no longer classed as retail. That means advisers won't need their retail distribution licenses anymore. They can kiss the FCA goodbye and good riddance.

A New Dawn: Fixed Fee Financial Planning

The smart move? Proper financial planners should consider ditching the product sales business model. Focus instead on fixed fee financial planning, where there's a clear wall between planning and products. In a market where investments are commoditised, the real value lies in the planning.


It's time for financial planners to step out of the shadows of product selling and embrace the light of true financial planning. This isn’t just a career move; it's an evolution. And for those ready to retire from the hamster wheel of regulated product selling, but not from the rewarding field of financial planning, there’s help.

Contact the Academy of Life Planning today. Discover how to transition from a business model dependent on product sales to one focused on genuine financial planning. Because the future isn't in pushing products; it's in planning a better financial future for your clients.

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