In the UK, networks of financial advisers are increasingly pushing back against appointed representative (AR) firms looking to run side ventures offering generic independent financial advice (IFA) services. The standard objection? “It’s a compliance risk.” The reasoning? These activities lie in the blurry borderlands of the FCA perimeter and detract from the focus on the core business—product intermediation and asset gathering.
But let’s be blunt: this stance is not just wrong. It’s shortsighted. It jeopardises long-term client relationships, ignores regulatory clarity, and potentially threatens the very future of these networks.
The Regulatory Perimeter Is Not the Problem
Generic financial advice—that is, guidance not linked to specific regulated products or services—is explicitly outside the scope of the FCA’s regulatory perimeter. It only enters the regulated domain when it’s used as a stepping stone toward product intermediation or regulated investment activity.
This is not a grey area. It’s clearly black and white, and well understood in regulatory guidance. If a firm offers generic advice without any intention to sell regulated products, that activity sits outside the remit of FCA authorisation. So why are networks telling ARs they can’t operate such ventures?
It’s not a legal barrier. It’s a business model conflict.
Consumer Duty Changes the Game
Under the FCA’s Consumer Duty, firms are now obliged to assess the appropriateness and value of their services across different client segments. That includes ensuring fair value—not just for wealthy delegators with investable assets, but for everyone.
But most networks have responded by tightening their client segmentation models. Many now serve only the top 8% of the population who have enough investable wealth to be profitable under an AUM model—typically older, wealthier baby boomers. That leaves 92% of the UK population—including Gen X, Y, Z, business owners, landlords, self-directed investors, those with pensions or non-financial wealth—effectively locked out of access to any advice.
By prohibiting generic side hustles, networks are actively turning their backs on these underserved groups. This is a profound strategic mistake.
Tomorrow’s Clients Are Today’s Children
The children of today’s clients—the very people who are inheriting wealth—are not being engaged. They are not being served. And they will not stick with networks that only want to talk about investments once they cross a certain asset threshold.
The ONS Wealth and Assets Survey confirms that over 95% of household wealth is not held in investable assets. It’s held in pensions, property, businesses, collectibles, and human capital. Networks that restrict advice only to the investable slice are missing out on the broader financial lives of their clients—and the opportunity to retain and nurture long-term relationships across generations.
You Can’t Retain Clients By Ignoring Their Lives
Here lies the critical distinction: traditional financial planning within the regulatory perimeter treats the money as the client. It’s efficient, yes—but shallow. These services are typically designed to minimise time, avoid holistic conversations, and push products with the least friction.
Holistic wealth planning, by contrast, treats the person as the client. It involves deeper conversations, more time, more care, and, often, unregulated yet valuable services. It’s about purpose, life planning, and aligning wealth—financial and human capital—with goals and values.
And guess what? It’s the latter that clients truly value. When networks insist that ARs drop the life-first approach in favour of an asset-first one, they risk alienating clients. You can’t expect loyalty if all you care about is the money. Clients will vote with their feet—and walk into the arms of holistic wealth planners.
The Existential Risk You’re Not Seeing
By refusing to let AR firms diversify into generic advice, networks are planting seeds of their own decline:
- Client dissatisfaction: Restricting broader conversations devalues the adviser-client relationship.
- Future irrelevance: Younger clients and non-traditional wealth holders are not being served or engaged.
- Brand erosion: Networks are becoming known for transactional, impersonal services rather than life-changing guidance.
- Recruitment and retention struggles: Advisers who want to make a difference in people’s lives will move to platforms that let them.
Networks like Best Practice and Positive Solutions should heed this warning: suppressing innovation and diversity in service delivery is not good compliance—it’s bad strategy. The world is moving toward a more client-centric, holistic, and purpose-led model of financial guidance. Your ARs see it. The public is demanding it. The FCA is nudging you in that direction.
A Better Way Forward
Rather than blanket prohibitions, networks should adopt a compliant, structured, and enabling approach to generic advice side hustles. Done well, these can:
- Expand reach to underserved demographics.
- Act as feeders for future regulated business.
- Build brand trust and reputation.
- Increase adviser satisfaction and retention.
- Support long-term client retention across generations.
And crucially, it aligns with the Consumer Duty’s mandate to deliver fair value across all segments—not just the affluent.
The Real Question: Is It Ignorance, or Is It Greed?
The rules are clear. The opportunity is real. The demand is undeniable.
So, if you’re a network leader reading this, ask yourself: Are you blocking these services because you genuinely misunderstand the regulatory framework? Or are you prioritising your own short-term revenue interests over the long-term sustainability of your business and the well-being of the people you claim to serve?
Because doing nothing isn’t just a missed opportunity. It’s a threat to your survival.
Your Money or Your Life
Unmask the highway robbers – Enjoy wealth in every area of your life!
By Steve Conley. Available on Amazon. Visit www.steve.conley.co.uk to find out more.
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