"Most industries have already evolved and adapted but in the financial planning sector we’re still waiting for innovation to fully pave the way for this."
Speaking at the Momentum UK Financial Wellness Roundtable, Mann said the financial planning sector requires a rethink of its current regulatory framework to make advice relevant to everyone and not just "people who have money".
His comments follow research from Momentum UK which found that a large portion of the UK would struggle to meet the current costs of financial advice. According to the report, a third (32%) of UK adults would find it difficult to meet an unexpected major expense, two fifths (39%) have had to make cutbacks in the last year to make ends meet, while a quarter (24%) of UK adults have less than £100 in savings.
According to recent industry data, the standard hourly fee for a financial adviser in the UK is £150 and an initial review costs an average of £500, while more specialist advice, on areas such as direct benefit transfer, will cost closer to £1,500. On top of this, just one in five advisers (22%) deal with clients of any wealth level.
At the roundtable, Peter Mann stressed that the responsibility for making advice affordable did not lie just with advisers, as "financial services manufacturers have a large role to play in bringing products and services to their customers" and that "understanding of the client should go through all of the parts of the value check".
His sentiments were echoed by Matt Connell, Head of Regulatory Developments at Zurich Insurance Group, who suggested an RDR was needed "that was suitable to people’s lives".
Speaking after the event, Samantha Seaton, Managing Director of Momentum UK, added: “We must find a way to make the economics work so that financial advice is available to the mass market for the right price.
“Most industries have already evolved and adapted but in the financial planning sector we’re still waiting for innovation to fully pave the way for this."
