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Data reveal a third of advice seekers fall into advice ‘gap’

New data reveal more than a third of consumers actively seeking financial advice have less than £50,000 to invest, with a quarter only having less than £25,000 in investible assets, which will stoke concerns over an advice gap facing lower-value clients.

Data from adviser review website Vouchedfor covering the last two months of this year revealed that of those consumers who are seeking financial advice, 35 per cent have less than £50,000 to invest, with 25 per cent having less than £25,000.

Of the remainder, 16 per cent have over £50,000 and 27 per cent have assets between £100,000 and over £2.5m. Some 21 per cent that have searched the site for advisers have an ‘unknown’ amount.

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The data follows a recent study by NMG Consulting on behalf of the Association of Professional Financial Advisers, which found that just less than half of advisers have turned away clients post-RDR.

Apfa said the figures meant that up to 60,000 clients may have been denied access to advice post-RDR, although these figures were not provided in Apfa’s research.

The study followed another by Schroders, which found that 14 per cent had formally asked clients to leave their practice in the past 12 months.Of those asked to leave, three quarters had a portfolio of less than £50,000.

In August, FTAdviser revealed VouchedFor data showing that 46 per cent of advisers will deal with any level of wealth. This figure has remained broadly the same in the latest data at 47 per cent.

Just over a fifth of advisers said they will only deal with those who have over £50,000, 19 per cent will only advise those who have over £100,000, 7 per cent will only help those who have more than £250,000 and 1 per cent will only see those who have over £500,000.

The data also revealed that most requested service is advice on investments and savings, following by pensions and then mortgages.

Adam Price, founder of VouchedFor, told FTAdviser that the database has grown from a base of 300 IFAs earlier this year to just over 1,700. Consumer visits to the site have risen sharply and reached 25,000 last month.

Mr Price said: “This year has been a phenomenal year for independent financial advisers, contrary to what was predicted. Demand for advice has risen, not fallen. The vast majority of advisers have remained independent. And, IFAs remain accessible to all, with 47 per cent helping people with any level of wealth.”