Advisers are not sufficiently broadening their service to younger potential clients, leading to a wide segment of the population being underserved by professional advisers, according to St James's Place.
Research by the company on the future of financial planning found that just under a quarter (20 per cent) of the average adviser’s clients are aged under 45.
The research found that most advisers’ clients are aged between 46 to 60 (44 per cent), while a third (33 per cent) are over 60.
It found that when it came to exploring new clients, almost two-thirds (63 per cent) are targeting those aged 51 to 65, with over half (56 per cent) looking at 66 to 75 year olds.
SJP said that “advisers are not sufficiently broadening their service to the younger demographic” and argued that this would not change anytime soon, with only 25 per cent of current advisers exploring under 35s for new clients.
"The younger demographic is therefore underserved, but this presents an opportunity for advisers in future to expand their client base," the company said.
Meanwhile, personalisation was identified by the report as something that should be a priority for advisers and ensuring clients are regularly listened to, especially as the industry looks to attract is next generations of clients.
The research was conducted by Ad Lucem in February 2022 and the report was led and curated by Technical Connection. It surveyed approximately 1,000 advised clients with a minimum of £50,000 investable assets, 200 advisers and 200 unique advisory firms.
Technical Connection’s managing director Tony Wickenden, said: “Nearly a decade on from the retail distribution review, which aimed at transforming how financial advice was delivered and paid for, there are many key influencing factors to take into account when we look to the future of financial planning.
"These include, but are by no means restricted to, technology, regulation, consumer demand and expectations, together with adviser capacity and competence.
"Add to this economic, tax and pensions policy, client vulnerability and the ever-onward march of technology and you have a heady cocktail of opportunities and threats to be navigated.”
Elsewhere in the report, the research highlighted the need for advisers to embrace the power of technology.
It said: “Generally speaking, consumers want more technology touch points, while advisers want to keep tech on the periphery. This is not going to work in the future and advisers need to be prepared to adopt a new approach.”
Advisers surveyed said they saw an opportunity for technology to add value to their business, identifying cash flow planning, client reporting, client reviews, portfolio tracking and assessing risk attitudes as key areas that could benefit.
Quilter Financial Planning's managing director Amanda Cassidy agreed.