UK Financial Advisors 2019: Trends, Concerns, and Opportunities

In many respects, the UK financial advisor market is in strong shape: average revenues are up and the number of active advisors continues to grow. However, the effects of significant consolidation are beginning change the structure of the market. The number of financial advice firms is declining, and while the vast majority of players are still small outfits the number of larger players with over 50 advisors is on the up. This trend looks set to continue in the future. Unsurprisingly, Brexit is the chief concern of financial advisors at present, both for the uncertainty it brings and the looming prospect of a financial downturn. Even so, the long-term opportunity in the market is strong, with the aging population bringing consistent growth in a core target market – the over 65s. There is also ample scope to engage more with younger investors, who are far less likely to arrange investments through financial advisors than their older counterparts.

This report is a comprehensive analysis of the UK financial advice market, with a focus on key issues affecting IFAs and their businesses. It provides an overview of the UK IFA competitive landscape, analyzing advisor numbers, business models, and industry consolidation trends. It also examines the key demographics accessing financial advice and the factors driving usage; identifies threats and opportunities for IFAs trying to expand their business; analyzes the impact of Brexit and MiFID II on the UK financial advice industry; and examines factors influencing IFAs’ choice between independent and restricted models. The report draws from our proprietary 2019 UK IFA Survey and our 2019 Banking and Payments Survey.


– There were 5,246 financial advisor firms active in the UK market in 2018 – a drop of 35 players on 2017. This decrease was mostly felt among mid-sized firms of two to five and six to 50 advisors.

– 74% of advisors see the opportunity in targeting younger consumers. Auto-enrollment and the planned introduction of the Pensions Dashboards should help drive engagement with long-term planning.

– Of the financial advisors that use a platform, 85% work with three or more providers. Competition in platforms is strong, with more than 30 active players. Many believe the sector is ripe for consolidation.

Reasons to buy

– Understand which segments of the UK investment market offer the highest growth potential.

– Identify the main pain points of IFAs to engage with them effectively.

– Discover what is driving consolidation in the UK IFA market to understand how you can benefit from trends.

– Learn how IFAs choose their partners and product providers to increase your penetration of the market.

Companies mentioned



Blevins Franks

Aisa International

Blacktower Financial

St. James’s Place



Bankhall and SimplyBiz



Stirling House


AE Financial Services

Ascot Lloyd

Ashton House



Brewin Dolphin

Core Financial Services

CTL Three

CWP Financial Services

Debbie and Nick Burchall

DG Pryde

Emery Little Financial Services


Generic Financial Management

Grennan Advisers

Harvey Curtis

Harwood Wealth Management

HMFC Wealth Management

Index Wealth Management

Lifetime Investment & Seminar Services

Lyn Financial Services

Mark Hughes & Associates


Monopoly Financial Consultants

Newell Palmer

Nick Davies

Old Mutual Wealth

Premier Wealth Management

Robert Goodman Associates

Sanlam UK

Sense Wealth Management

Sims Financial Planning

Steve White

The Acumen Investment Partnership

Thomas Heald


Zimb Johnson Bespoke Financial Planning

British Steel

Active Wealth


Sandringham Financial Partners


Hargreaves Lansdown

Table of Contents

Table of Contents


1.1. The UK financial advisor market is performing well financially, but the shape of the market is changing

1.2. Key findings

1.3. Critical success factors


2.1. Growth in the number of financial advice firms and financial advisors is leveling off

2.1.1. There were 5,246 financial advice firms at the end of 2018, a dip from the 2017 high

2.1.2. The effects of industry consolidation are largely being seen among mid-sized firms

2.1.3. The majority of financial advisor firms are independent

2.1.4. Average revenues from retail investments are on the up

2.2. Financial advisors are the leading channel in the sale of pensions and investment products

2.2.1. Financial advisors accounted for 56% of pensions and retail investment product sales in the first half of 2019

2.2.2. Outside of pension investments, investors tend to arrange investments directly or via a financial advisor

2.2.3. The expertise of financial advisors is the key draw for investors

2.3. Affluent individuals are the mainstay of the advice market, with retirement a key prompt for seeking advice

2.3.1. Drivers for seeking financial advice center on changes to employment


3.1. Threats: Brexit is currently the chief worry for financial advisors, with concerns over regulation lessening

3.1.1. Advisors are particularly concerned about the impact of any financial downturn resulting from Brexit

3.1.2. In relative terms, compliance with regulation is less of a concern than in previous years

3.2. Financial advisors are most concerned about Brexit, followed by fears of a potential downturn

3.2.1. The UK’s financial markets have recovered since the post-referendum drop, but are falling once again

3.2.2. Advisors servicing British expats in Continental Europe face particular challenges

3.3. There are concerns over the tax treatment of pensions, with tapered annual allowances causing particular disruption

3.3.1. There are calls from some industry bodies and providers for the government to review tax treatment of pensions

3.3.2. The tapered annual allowance is causing particular disruption in public sector pensions

3.3.3. The netpay anomaly is a growing issue that affects lower-paid individuals

3.4. Opportunities: targeting the young and the growing aging population are considered key opportunities for advisors

3.4.1. Financial advisors see notable opportunities in targeting younger clients

3.5. Appealing to a younger generation will be key for broadening out a financial advisors’ client base

3.5.1. Older investors are much more inclined to use an IFA than younger investors

3.5.2. Auto-enrollment is an opportunity to engage with investors earlier on

3.5.3. The Pensions Dashboards project is also seeking to drive engagement with retirement planning from an earlier age

3.6. An aging population presents a growing core target market for financial advisors

3.6.1. By 2030 there will be

5.8 million additional adults of pensionable age

3.6.2. The aging population will have not just retirement planning requirements but also social care funding needs

3.7. Financial advisors could do more to improve the transparency of financial advice fees

3.7.1. There is notable variation between how firms present the cost of advice, rendering price comparisons difficult

3.8. Increasing numbers of advisors are seizing on the DB to DC transfer opportunity, but they should tread carefully

3.8.1. The number of DB to DC transfers continues to increase

3.8.2. Data collected by the FCA from those with the DB Transfer Advice Permission has raised misgivings over advisor practices


4.1. Service provision:Platform usage is a core part of advisor operations

4.1.1. Over 80% of the financial advisor market use or are planning to use a platform in the coming year

4.1.2. Ease of use is the key requirement that advisors have of platforms, but lower costs would be the greatest incentive to switch

4.1.3. Aviva is the most used platform by financial advisors

4.2. Service provision: Investment management is typically kept in-house, though outsourcing allows advisors to focus on clients and planning

4.2.1. Financial advisors are predominantly keeping investment management in-house

4.2.2. The ability to focus on financial planning is the key draw for those financial advisors that choose to outsource

4.2.3. Concerns regarding the impact to client relationships is the key barrier to outsourcing


5.1. Abbreviations and acronyms

5.2. Definitions

5.3. Methodology

5.3.1. GlobalData’s 2019 UK Financial Advisors Survey

5.3.2. GlobalData’s 2019 Banking and Payments Survey

5.3.3. GlobalData’s 2019 UK Life & Pensions Survey

5.4. Secondary sources

5.5. Further reading

List of Tables

List of Tables

Table 1: Selected financial advisor acquisitions, 2019

Table 2: Average retail investment revenues of financial advice firms (£), segmented by number of advisors, 2015-18

List of Figures

List of Figures

Figure 1: Growth in the number of financial advice firms and financial advisors was largely flat between 2017 and 2018

Figure 2: The number of firms with over 50 advisors increased slightly in 2018, while the number of mid-sized firms fell

Figure 3: The majority of financial advice firms operate as independent outfits

Figure 4: Retail investments account for the majority of financial advisor revenues

Figure 5: Financial advisors are the predominant channel for retail investment sales

Figure 6: Standalone financial advisors are the most commonly used channel to arrange investments

Figure 7: Financial advisors dominate the retail investment landscape both in terms of number of companies and number of advisors

Figure 8: Investors that use financial planners are actively seeking out investment expertise

Figure 9: Those investing directly have a strong preference for managing investments themselves

Figure 10: Mass affluent followed by massmarket individuals typically account for the majority of an advisor’s book

Figure 11: Mass affluent individuals are more likely to hold investment products than mass market or emerging affluent consumers

Figure 12: Changes in job circumstances and starting or exiting a business are the top reasons prompting clients to seek advice

Figure 13: The level of advice sought on withdrawing from a pension pot varies considerably by method of access

Figure 14: Uncertainty related to Brexit tops the concerns of financial advisors

Figure 15: The FTSE 100 recovered after a notable post-referendum drop in 2016, but there are concerns a significant fall lies ahead post-Brexit

Figure 16: 74% of financial advisors agree there is an opportunity in targeting younger consumers

Figure 17: Older consumers are much more likely to use an IFA than younger investors

Figure 18: Investors aged 18-34 are most likely to work with an advisor at their main bank to arrange investments

Figure 19: Auto-enrollment has succeeded in driving pension saving among younger workers

Figure 20: By mid-2043, the number ofindividualsof pensionable age will have risen 3.6 million on 2018

Figure 21: The growth in the aging population will see the number of over 65s increase by around 200,000-300,000 a year through to 2030

Figure 22: Aside from the ability to access pension freedoms, advice from family, friends, and advisors isthe key driver of DB to DC transfers

Figure 23: Financial advisors prefer to work with multiple platform providers

Figure 24: Ease of use is the number one feature financial advisors look for in a platform

Figure 25: Lower costs are the most likely to convince financial advisors to switch platform provider

Figure 26: Aviva is the most commonly used platform by financial advisors

Figure 27: Client assets are primarily invested viain-house model portfolios and in-house bespoke DFM

Figure 28: The ability to focus on financial planning is the key draw for advisors outsourcing investment management

Figure 29: A good investment track record is the number one driver for advisor selection of an external DFM

Figure 30: Concerns over client relationships are the key deterrent to outsourcing investment management


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