FTAdviser understands that Vanguard will be issuing a refund for all financial planning fees that clients have incurred from the service since they joined.
The firm said it launched the service for clients of its existing platform with specialised retirement needs.
However, a spokesperson said: “After careful consideration, we have concluded that our clients are looking for other, more adaptable forms of financial planning from Vanguard.
“We have therefore taken the difficult decision to close the retirement planning service. We are committed to the development of further financial guidance and advice services, to give investors the best chance of investment success.”
The service will close on May 31 this year.
At that stage clients will have the option to manage their funds on the self-directed platform (UKP) or to transfer to another adviser.
FTAdviser understands that Vanguard has decided to go in a different direction with how it helps direct to consumer clients meet their investment goals.
When it launched the financial planning arm two years ago, it was a specialised retirement planning service for users of the UKPI platform.
While the service did appeal to those looking for specialist, sophisticated retirement planning, FTAdviser understands that Vanguard’s clients are looking for different, more adaptable forms of help.
Vanguard launched its financial advice service in the UK in 2021, charging an 'all-inclusive' ongoing fee of 0.79 per cent.
The headline cost was set to incorporate annual platform charges of 0.15 per cent, ongoing fund charges of 0.12 per cent, transaction costs and an advice fee of 0.5 per cent.
At the time, Vanguard said it would not charge an initial, or any other, fee.
The service was targeted at clients with assets of £50,000 or more.
The financial planning arm was set to focus on providing restricted advice to those saving for retirement, though at the time, it said its emphasis would remain on investment advice rather than encompassing areas such as protection or full-scale tax planning.
There are currently 480,000 users of UKPI, with the average age of 38, and 30 per cent are under 30.
FTAdviser understands the firm is still committed to developing further advice and guidance services for retail investors.
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