Upbeat outlook for IFAs

Many advisers worried about their businesses going bust in the run up to the RDR deadline, but now the mood could not be more different.

Almost half (47 per cent of advisers) said they expected their revenues to grow by 10 per cent or more in 2014, 20 per cent expect revenues to stay flat, while only 7 per cent expect revenues to fall

The average financial adviser in the UK now has 240 clients, a slight increase on 228 clients in 2013.

But challenges remain, with compliance seen as the main concern this year, followed by attracting and servicing new clients.

So the much anticipated mass exodus of advisers has not happened, but one milestone awaits the sector in 2016 when trail commission can no longer be taken.

Interestingly, 13.7 per cent said they planned to leave the industry in the next three to five years, which would coincide with the end of trail commission.

However, the overall message from the report, according to CoreData, is that advisers are bullish on revenue and client growth, while worries about the ‘death of the adviser’ are of much less concern.

The majority said client numbers will grow over a one-year period while a third of advisers expect client numbers to rise by more than 20 per cent over the next five years.

Joshua Gerstler, adviser for Hertfordshire-based The Orchard Practice, said: “The impact of RDR on our business has been positive. Clients have valued the qualifications we have obtained and welcome the transparency of our fees. Combined with the positive mood surrounding the economy, our business has benefited enormously.”

Marc Shoffman is a financial journalist