OK, this might sound a bit financial-adviser-nerdy, but is a reminder that the Law of Unexpected Consequences should always be expected when brave new policies are introduced. Our regulator introduced something called ‘Consumer Duty’ last year, which required both advisers and providers to review their businesses and ensure they have ‘a clearly defined target market’ for whom their products and services ‘represent fair value’. Many as a result have decided that they can’t be all things to all types of clients and that they should perhaps focus on fewer and charge accordingly for the service provided. Which means the much discussed ‘advice gap’ widens, and is likely to continue to widen, still further. Another trade press headline this week: ‘Adviser exodus looms with half planning to retire in next five years’. To paraphrase a memory of a previous election, things don’t, necessarily, always get better.
“FCA: ‘We’re not against small firms’”
We’ve always been a small firm, even when we thought we were big, as the official classification is ‘ten advisers or less’. There is a, perhaps justifiable perception that our regulator would prefer to regulate far fewer big firms, rather than the many thousands of smaller adviser companies which are still in the vast majority, with over 88% of the 4,600 odd directly-authorised financial advisers comprising less than 5 advisers.
