It is already happening with pensions and it is about to happen with investments. A combination of the RDR – which has seen independent advice rise in price and bank sales forces close – along with the rise of execution-only platforms, means that eventually many of us will do our own thing.
Mr Thorman, who founded the wrap platform six years ago, says: “It’s something that Thatcher tried to start. Most Americans have got used to platforms and doing their own thing. We’ve got to learn how to do that.
“It’s a fact of life that 50 per cent will never have enough cash to invest in a long-term product – it’s where auto-enrolment is basically saying, ‘We’ll do it for you’.
“If I’m really well off, I’ll get an adviser. But if I don’t have an adviser and I’m not well off then I’ll do it myself and go directly.”
“Research says that only 15 to 16 per cent of customers are going to want advice; there’s 20 per cent who are going to do it for themselves and the rest are going to do it for themselves with occasional input from the adviser. Eighty per cent want to deal with the platform directly, so I think it’s going to be really important.”
A big factor driving this has been the recent regulatory changes. He says: “It’s completely down to RDR, because it’s RDR that has taken away bank sales forces. Everybody thought bancassurers would take over, and a lot of IFAs have withdrwn from the market and the companies that are there are going to charge a lot of money.
“Say you have £20,000, and you say to an adviser: ‘I want you to tell me what I should be investing in’, he’s going to say ‘It’s going to cost you £1000’. If you’ve only got £20,000, you’re not going to want to do that.”
Ascentric, which sold out to Royal London Asset Management nearly six years ago, is planning on launching its own direct offering, which it is describing as B2B2C.
“What we want to do is to continue to provide the very best platform service for the customers, and giving advisers the ability to have clients deal directly on the platform, to have a non-advised platform.”
The challenge however, is risk. Since advisers come under so much pressure to make sure they get their advice correct, how does a client make sure he makes the right decision?