This lays a plank on the bridge between generations, and will be an important step towards securing good outcomes for those giving, and those receiving, funds.
Now, there is valid question over the FCA’s proposals regarding just how profitable and feasible it will be for firms to establish two advice lines – one for ‘traditional’ advice, and one for the simplified regime.
However, those who can justify the service could see their investment deliver returns of multiples more over the long run by helping develop a pipeline of advised clients of the future.
While those accessing simplified advice today may not currently have financial circumstances that justify traditional advice, they may do in years to come.
Building formal relationships with them now will help firms retain their business as their finances become more complex over time. The simplified advice clients of today could very well be the advised customers of the future.
The road ahead
It remains to be seen whether the FCA proceeds with its proposals for advice simplification, or if it chooses another approach.
Whatever the outcome, advisers should be alive to how a simplified advice regime can help span intergenerational divides.
A simplified regime will not be the right option for every firm.
But for those where it is relevant and makes commercial sense, delivering it will not just support better outcomes for clients. It will underpin future client lists, too.
It is an opportunity they cannot afford to miss.
Noel Butwell is chief executive, adviser at Abrdn
