The number of younger advisers has fallen in the past 18 months while the number of older advisers has grown, raising concerns about the advice gap.
Data provided by the Financial Conduct Authority to FT Adviser revealed that as of February 2024 there were 174 advisers authorised to provide retail investment advice under the age of 25.
This is a significant drop of 60 per cent from August 2022 when FT Adviser found there were 426 retail advisers aged below 25.
Meanwhile the number of advisers aged over 60 has grown from 4,824 in August 2022 to 6,210 in February 2024, a jump of 29 per cent.
The majority of advisers in the UK fall into the 50-59 age bracket at 9,777 while there are only 1,641 aged between 25-29 - a category which saw a drop of 18 per cent in 18 months.
There were a total of 31,182 advisers in February 2024 compared to 31,144 in August 2022, showing that those under the age of 30 make up a very small proportion of the advice profession.
Number of individuals in the UK authorised to provide retail investments advice by age range
| Age range | Aug 2022 | Feb 2024 | % change |
| Under 25 | 426 | 174 | -59.15 |
| 25-29 | 1,989 | 1,641 | -17.50 |
| 30-39 | 5,668 | 5,758 | +1.59 |
| 40-49 | 8,200 | 7,622 | -7.05 |
| 50-59 | 10,037 | 9,777 | -2.59 |
| Over 60 | 4,824 | 6,210 | +28.73 |
Source: FCA via FT Adviser FOI
Mortgage market
Things are not much better among mortgage brokers.
Of the 35,109 individuals authorised to provide mortgage advice, only 536 are under the age of 25.
This is a drop of 50 per cent from August 2022 when there were 1,067 brokers this age.
Likewise, those aged between 25-29 also fell from 3,216 to 2,309 - a drop of 28 per cent.
But like retail advisers, the mortgage market saw a growth in the number of older brokers.
In August 2022, there were 4,060 over the age of 60 and by February 2024 this had jumped by 26 per cent to reach 5,097.
Number of individuals in the UK authorised to provide mortgage advice by age range
| Age range | Aug 2022 | Feb 2024 | % change |
| Under 25 | 1,067 | 536 | -49.77 |
| 25-29 | 3,216 | 2,309 | -28.20 |
| 30-39 | 9,594 | 8,896 | -7.28 |
| 40-49 | 9,608 | 9,635 | +0.28 |
| 50-59 | 8,344 | 8,635 | +3.49 |
| Over 60 | 4,060 | 5,097 | +25.54 |
Source: FCA via FT Adviser FOI
Advice gap
Matthew Connell, director of policy and public affairs at the PFS, said these figures underlined the urgent need to promote the profession to younger people.
He said that as financial services becomes less integrated, with specialist firms becoming more common, there were fewer paths for school leavers into the advice sector.
Connell explained the PFS has introduced a tool for young people planning for a career in financial services, called ‘Future Me’, and also has Education Champions in schools to introduce young people to the world of financial planning and help plan a career in the profession.
He said a reason for the change in numbers could be the volatile labour market.
Connell said: “Many people over the age of 50 disappeared from the workforce immediately after the pandemic, so these figures may show that some people in that age group are coming back into employment after a break from work.”
It could also be down to consumer demand, he added.
“There is more demand for advice in retirement, as people’s income gradually moves from defined benefit pension schemes to defined contribution schemes, or from drawing down some of the value of their house,” Connell said.
“People tend to take advice from professionals with a similar demographic background, and so it might be that there is a greater demand for older advisers who can easily empathise with issues around retirement income planning.”
Keith Richards, chief executive of the Consumer Duty Alliance, said while there are no real surprises in the data, it did validate concerns of a potential adviser gap to meet the ongoing needs of existing clients, let alone address the advice-gap for new clients.
"The data from FCA provides evidence that we are heading for an adviser-gap, as numbers have shifted up the age bands with over fifty percent now aged 50 years or over and over half of that population well into their 60s," he said.
"The stark reality is that the statistics also show that the sector has seen few new advisers enter the profession, as the age 29 years and under categories have reduced by 59 per cent, compared to two years ago.
"We would like to see FCA include gender and ethnicity within their future statistics to help bring greater focus on diversity and inclusion."
Richards added more needed to be done to attract young advisers as academies do not focus solely on graduates or apprenticeships, as the second career market has always been the main supply of new talent.
He said: "The Consumer Duty Alliance is currently in the process of launching a New Talent Alliance Forum to collectively work on strategies that will attract new blood to the profession, create good practice sharing and augment the role of academies and the various routes to a professional career in personal finance.
"As succession planning through consolidation vehicles is showing some signs of slowing, we are seeing a revived interest to succession to develop the next generation within the same firm and the Alliance aims to offer support to small firms via our Affiliate network."
Last month, FT Adviser revealed the number of firms authorised to provide retail investment advice had fallen from 6,240 in August 2022 to 5,805 as at February 2024.
This meant 435 firms have disappeared from Britain, and represented a drop of 7 per cent in as little as 18 months.
amy.austin@ft.com
