A research report from Standard Life has revealed that the UK needs about 5,000 additional financial advisors to meet the increasing demand for retirement advice.
The company based its calculation on Office for National Statistics figures, which revealed that there were about 3.8 million people in 55-and-over age group with at least £100,000 in financial wealth, but only 20,500 advisors to serve them, reports ifaonline.co.uk.
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Based on a 150-clients-per-advisor metric, Standard Life estimated the shortfall in the number of professional financial advisors needed to cater for this market currently stands at about 5,000.
The Financial Conduct Authority’s (FCA) statistics says that there were 20,453 independent financial advisors in the UK at the end of 2012.
Eddy Reynolds, head of advisor and investment proposition at Standard Life, said the company’s estimation may be considered conservative.
Reynolds added: "If we take the number of people aged 45 and over with more than £100,000 in financial wealth, the total is close to five million. While not all of this younger age group might immediately need financial advice, as they start to approach the at-retirement stage it is likely they will turn to a financial advisor.
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By GlobalData"This means there could potentially be an advisor gap of 12,674 in the next ten years if the current number of advisors remains static.
"The belief that there is a decline in potential demand for the financial advisor market couldn’t be further from the truth. There are a significant number of people aged over 45 who are asset rich and the financial advisor marketplace needs to grow in order to match the demand for advice that will inevitably be coming in future years," Reynolds concluded.
