UK rules mean millions won’t receive financial advice!
In today’s world financial advice is vital, yet the new rules coming in this year in the UK mean millions may not receive the advice they badly need going forward.
From December 31st 2012, financial advisers will no longer be allowed to accept a commission from providers for selling insurance or investment products and will instead have to agree a fee with clients.
The change forms part of the retail distribution review (RDR) and is intended to improve professional standards within the advice sector and remove the commission bias advice which has been blamed for past miss-selling scandals.
However, there is no evidence to show commission causes bad advice. In fact salaried bank advisers receive many times as many complaints as professional IFA’s who receive a fee/commission from the company that they introduce clients to.
According to recent research, millions of investors may choose not to take professional financial advice from next year once new rules make it clear how much they are going to pay.
In a survey of investors, one-third of those with more than £50,000 in liquid assets said that they would stop using advisers if charged directly, said Deloitte.
At the deVere UK part of the deVere Group we are already complying with the new rules that come into force next year. What personally concerns me is that millions will suffer through lack of financial advice and financial planning.
Sometimes regulators harm the very people they seek to protect.
Nigel Green deVere Group
Blog November 12th