More young people need to be attracted into the financial sector as it is in danger of becoming “the exclusive domain of only super wealthy”, warns one of the world’s largest independent financial advisory organisations.
The comments from Mike Coady, managing director of deVere UK, part of deVere Group, follow a report that demands for financial advice are soaring.
Mr Coady explains:
“Demand for professional independent whole-of-market financial advice continues to skyrocket with no sign of slowing down.
“The strong demand is, amongst other factors, being fuelled by the recently introduced landmark pension reforms, which have given individuals new freedoms and controls over their retirement incomes; the fact that financial education is increasingly being offered in workplaces and schools; and because since the 2008 crash, people have become more aware of the importance of sound financial advice.”
Coady goes on to explain that that demand for financial advice is now beginning to exceed the number of independent advisors.
This is due to many choosing to opt out of the advice market and enter into a ‘restricted advice’ business model, since the introduction of the Retail Distribution Review (RDR).
“Whilst RDR has driven up industry standards, qualifications and transparency, it has left the number of independent advisers significantly reduced.
“There is also an ageing adviser population, with considerable numbers retiring from the profession each year.
“With this in mind – and because it takes a considerable amount of time and money to fully and appropriately train independent financial advisers – the sector needs to attract new, young talent sooner rather than later.
“A failure to bring new blood into the industry, will leave consumers with a smaller pool of advisers – and, inevitably, this could result in financial advice become the exclusive domain of only the super wealthy.”
Coady suggests that as a collective industry, more needs to be done now before adviser numbers drop significantly.