‘Young advisers blocked by tough regulations’

The chief executive of online forum Panacea Adviser said increased capital adequacy requirements and regulatory fees were hampering the recruitment of newly-qualified advisers, or those who wished to set up their own firms.

His comments came as a young, diploma-qualified paraplanner, known to Financial Adviser, claimed that unless he had many years of experience, a big client book or a family member with an existing business, it was hard to pursue a career in the industry.

He said: “I want to progress as an adviser but firms only want ready-made advisers with an existing client bank.

“It’s a short-sighted approach and it ultimately means there are fewer advisers coming through, with many clients priced out of advice.

“Even if I were to set up my own firm, the costs would be prohibitive so it’s a catch-22 situation.”

Industry View

Stephen Hagues, managing director of North Yorkshire-based business matchmaker Retiring IFA, said: “Most IFA businesses are based around the lead adviser rather than having a system for new client generation into which young people could be plugged in.

“There are exceptions to the rule however the best route into the industry will probably be through a larger provider or banking type operation.”