Nearly half of regulated financial advisers are contemplating exiting their businesses within the next two years, according to recent reports. The primary reason for this trend is retirement, with compliance challenges coming in a close second. The increasing burden of onerous ongoing service review justification files seems to be taking its toll.
For many seasoned financial services professionals, the concept of retirement doesn’t necessarily equate to complete disengagement. Instead, it presents an opportunity to pivot towards an encore career—one that doesn’t feel like work but rather an extension of their passion, performed a few days a week. This career is in non-intermediating financial planning.
Non-intermediating financial planning allows advisers to retire from the heavy regulations that come with giving advice, while still leveraging their extensive knowledge and experience to help others. It offers a flexible and fulfilling way to stay active, fund those skiing, golfing, and fishing trips, and maintain a sense of purpose.
Why Make the Shift?
- Retirement and Fulfillment: Many advisers are not ready to retire fully. They seek a balance between leisure and engaging in meaningful projects that keep their skills sharp and provide a sense of contribution.
- Reduced Compliance Burden: The compliance landscape for regulated advisers is becoming increasingly complex. The constant need to justify ongoing service reviews and navigate the evolving regulatory framework can be exhausting. Transitioning to non-intermediating financial planning significantly reduces this burden.
- Client-Centric Focus: In non-intermediating financial planning, the focus shifts from selling products to providing holistic financial guidance. Advisers can work directly with clients to empower them in managing their finances, fostering a more educational and supportive relationship.
- Predictability and Stability: Given the unpredictable nature of regulatory changes and the accountability demanded for future financial outcomes, advisers find it challenging to assure clients of the ‘best’ advice long-term. Non-intermediating financial planning allows for a more stable and less risky professional environment.
Addressing Industry Concerns
Recent comments from industry professionals highlight the growing concerns:
“Having recently heard how unreasonable some FOS decisions are and the amount of ‘cards’ clients have been given to play e.g., vulnerability/duty of care, etc., it is now too risky to give advice. It is impossible for us to predict what may turn out to be ‘best’ 10-20 years in the future – the FCA moves the goalposts, legislation changes, or simply ‘life’ changes, and we are accountable. Simply unworkable. I’m surprised it is only half!”
This sentiment underscores the urgency for a career shift. Advisers are increasingly recognising the challenges and are seeking alternative paths that align better with their lifestyle and professional goals.
Embrace an Encore Career
Retiring from regulation doesn’t mean retiring from work altogether. It means finding a new path that aligns with your values, expertise, and lifestyle aspirations. Non-intermediating financial planning offers a viable and rewarding alternative, allowing you to continue making a difference without the regulatory headaches.
Explore the possibilities of this encore career and enjoy a fulfilling professional life that complements your personal passions. It’s time to retire from regulation but never from meaningful projects you enjoy.
Q&A: Retiring from Regulation and Embracing Non-Intermediating Financial Planning
Q1: Why are nearly half of regulated financial advisers looking to exit their businesses in the next two years?
A1: According to recent reports, the primary reasons for this trend are retirement and the increasing burden of compliance. Many advisers find the ongoing service review justification files and evolving regulatory landscape overwhelming, prompting them to consider exiting the regulated environment.
Q2: What is non-intermediating financial planning?
A2: Non-intermediating financial planning involves providing holistic financial guidance without selling products. Advisers focus on educating and empowering clients to manage their finances independently, reducing the compliance burdens associated with traditional financial advice.
Q3: How does non-intermediating financial planning differ from traditional financial advising?
A3: Traditional financial advising often involves recommending and selling financial products, which requires compliance with stringent regulations. Non-intermediating financial planning, on the other hand, centres on offering financial education and guidance without product sales, thereby minimising regulatory obligations.
Q4: What are the benefits of transitioning to non-intermediating financial planning for advisers nearing retirement?
A4: Transitioning to non-intermediating financial planning offers several benefits:
- Reduced compliance burden
- Opportunity to stay professionally active without the stress of heavy regulations
- Flexible working hours to accommodate personal interests like skiing, golfing, and fishing
- Continued use of their expertise to help clients in a meaningful way
Q5: How does non-intermediating financial planning provide a sense of fulfillment for retired advisers?
A5: Non-intermediating financial planning allows retired advisers to remain engaged in their field, boosting their pension pots, and providing valuable guidance and education to clients. This career path offers a sense of purpose and the satisfaction of making a difference, without the pressures and risks associated with regulated financial advice.
Q6: What are some challenges faced by regulated financial advisers that non-intermediating financial planning addresses?
A6: Regulated financial advisers face challenges such as:
- Unpredictable regulatory changes
- The need to justify ongoing service reviews
- Accountability for long-term financial outcomes, which can be influenced by factors beyond their control, Non-intermediating financial planning mitigates these challenges by focusing on education and guidance rather than product sales and regulatory compliance.
Q7: Can advisers transitioning to non-intermediating financial planning still use their expertise effectively?
A7: Absolutely. Advisers can leverage their extensive knowledge and experience to educate clients about financial management. This approach allows them to continue using their skills in a supportive and impactful way, without the regulatory constraints of traditional advising.
Q8: What are some common sentiments among advisers about the current regulatory environment?
A8: Many advisers express frustration with the regulatory environment, citing unreasonable decisions by the Financial Ombudsman Service (FOS) and the increasing number of “cards” clients can play, such as claims of vulnerability and duty of care. These factors make it risky to provide traditional financial advice and contribute to the growing interest in non-intermediating financial planning.
Q9: How can advisers interested in non-intermediating financial planning get started?
A9: Advisers can start by exploring educational resources and training programmess focused on non-intermediating financial planning, such as those provided by the Academy of Life Planning. Networking with other professionals in the field and joining relevant associations can also provide valuable insights and support during the transition.
Q10: Is non-intermediating financial planning a sustainable career option for long-term?
A10: Yes, non-intermediating financial planning is a sustainable career option. It allows advisers to maintain a flexible and fulfilling professional life while reducing regulatory pressures. This career path can adapt to changes in the financial landscape and continue to provide meaningful work opportunities for experienced advisers.
For more details on how you can retire from regulation and embark on a fulfilling encore career in non-intermediating financial planning, visit the Academy of Life Planning today. Join us in transforming your financial and personal journey, ensuring a future filled with purpose and prosperity.
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