In pursuit of organic growth for their businesses, over three quarters of financial advisers want to increase the value of their assets under advice, according to new research from NextWealth and Aegon.
On a positive note, nearly half of advisers confirmed they were already working more clients than at the same time last year. However, it would appear that a substantial group of potential clients remain unserved, as only 14% of people in the UK with more than £100,000 in investable assets currently receive financial advice. This represents a significant opportunity for many advisers to expand their client reach and assume more assets under their service, yet only a tenth have a clearly defined strategy for how to do so.
To help them grow, advisers highlighted that a more relaxed regulatory framework for people with simpler needs would have the biggest impact on enabling them to attract new clients in the next 18 months (48%). This was followed by an easier process for onboarding clients (35%) and more efficient ways to serve lower-value clients profitably (33%).
As the financial advice landscape continues to evolve, NextWealth and Aegon say businesses that strategically embrace organic growth and adapt to regulatory developments – such as targeted support – will be well-positioned to thrive. In order to help them achieve this, the firms have launched a new guide outlining six key steps that advice firms can take when looking to grow their business organically and sustainably.
Stephen Crosbie, managing director of adviser platform at Aegon UK, commented: "Financial advice firms are ideally positioned to capitalise on this moment of heightened demand and opportunity. By strategically focusing on organic growth, firms can sustainably extend their services to more clients, which not only benefits them, but would also generate a positive ripple effect across the economy.
“With advancements in technology and a favourable regulatory environment, advisers can optimise their operations and processes to reduce friction and enhance client experiences.
“By supporting more individuals to make informed investment decisions, we harness the potential to drive substantial positive outcomes for everyone involved. This is a transformative moment for the industry, and those who adapt and innovate will be leading the way in shaping the future of financial advice.
“But this research shows that we need to support our advice community, and call for the regulators to implement a more relaxed framework for clients with simpler needs. We’ve come a long way with the imminent outcomes for targeted support expected later this year. But it’s crucial that the regulators act to provide the necessary backing to enable a more supportive regulatory environment. Together, we can ensure that more people are helped to achieve their financial goals through informed decision-making, backed by a flexible and inclusive regulatory framework.”
Heather Hopkins, managing director and founder of NextWealth, added: “Our partnership with Aegon on this guide allows us to explore the critical topic of sustainable, organic growth in financial advice firms. The findings reflect the challenge of managing regulatory change and delivering an ongoing service to existing clients, while still finding time for strategic thinking about growth. Despite these challenges, the demand for financial advice presents significant opportunities for firms willing to carve their own path and leverage their expertise.
“Our research highlights successful strategies employed by firms, such as deepening client relationships, reconnecting with previously overlooked clients, and developing innovative propositions. For financial planners looking to grow, adopting these strategies and innovating in service delivery can unlock organic growth potential. With the right regulatory and support frameworks, we can collectively ensure that more individuals achieve their financial goals, which will benefit their firm, the industry, and the broader economy.”
