The FCA has proposed ‘targeted support’ to help those missing out on advice, and at risk of poor outcomes like unsustainable pension drawdown or excess uninvested cash, access tailored financial guidance and support.
This type of help will sit alongside simplified and full advice, offering more accessible options to help close the advice gap and support informed financial decisions.
The FCA ran its first six-week policy sprint with industry and consumer groups to shape the proposals, now out for an eight-week consultation. The reforms aim to boost innovation, widen access to support, and are part of a broader package of nearly 50 initiatives promised to the Prime Minister.
The proposal follows research from the FCA’s Financial Lives Survey, which found that only 9 per cent of adults received advice last year. Many holding £10,000+ in cash cite lack of knowledge or feeling overwhelmed as barriers to investing.
FCA deputy chief executive Sarah Pritchard says: “We want to help consumers navigate their financial lives and plan for the long term. Some of the most difficult financial decisions we face are how to save, invest and prepare for a comfortable retirement.
“These once-in-a-generation reforms will help people navigate their financial lives and give them greater confidence to invest. This is a win-win for consumers and firms alike.”
Scottish Widows and insurance, Pensions & Investments at Lloyds Banking Group CEO Chira Barua says: “More than 90 per cent of consumers in the UK today cannot access regulated advice and get the help they need to make informed decisions about their futures. As the UK’s biggest digital bank and the only integrated bank and insurer, Lloyds is passionate about helping our 28m customers bridge the advice gap. The FCA’s work to refine the advice rules is a material stepping stone in building a more inclusive financial landscape in the UK.”
Standard Life Centre for the Future of Retirement director Catherine Foot says: “With the consultation published today, targeted support has moved another step closer to becoming a reality. We’ve spent the last few months in discussion with people approaching retirement to gauge if and how the concept of targeted support appeals to them, and to understand the customer needs it could address.
“A recurring theme of the conversations is the need to address the anxiety and the feeling of being overwhelmed many have when it comes accessing their pensions. With regulator aiming to have the final policy statement published in December, now is the time for the industry to help shape a service that supports people with some of the most challenging and significant financial decisions they will ever make.
“Our report outlining consumer expectations of targeted support will be published in the coming weeks, with important insights for the industry to use as they build targeted support services.”
