By Steve Conley, Founder of the Academy of Life Planning
Adviser platforms are seeing record-breaking inflows — and yet, paradoxically, the AUM-based advice model is showing signs of terminal decline.
According to new data from the lang cat, adviser platform outflows hit a record £17.94bn in Q3 2025 — the highest on record — even as gross inflows rose to an unprecedented £23bn. The reason? A pre-Budget rush of clients and advisers repositioning assets ahead of anticipated changes to inheritance tax (IHT) and pension rules.
The cracks beneath the surface
At first glance, the figures suggest a healthy market: total assets under administration rose 6% to £711bn, buoyed by market performance. But beneath the numbers lies a deeper story.
Clients are no longer content to leave their wealth passively parked in fee-bearing portfolios. The fear of policy change — especially around pensions and inheritance tax — has prompted an exodus of capital into more flexible, self-directed, and purpose-driven structures.
For advisers who charge based on assets under management (AUM), this is an existential threat. Every pound withdrawn in anticipation of tax reform represents a permanent erosion of their revenue base.
The end of “lazy money”
The old model thrived on inertia — the illusion of steady growth as markets rose. But today’s investors are restless, informed, and increasingly empowered. They are shifting from dependence on intermediaries to direct control over their financial architecture.
Fundscape reports that direct-to-consumer (D2C) platforms saw assets surge 17% year-on-year to a record £478bn in Q3, with net flows accounting for around 20% of growth. Interactive Investor, AJ Bell, and Vanguard lead this movement — platforms that offer cost transparency, self-direction, and empowerment over delegation.
This is not just market rotation. It’s ideological. The Age of Empowerment is replacing the Age of Extraction.
Planning, not selling, is the new premium
The industry’s response to pre-Budget outflows exposes a fundamental flaw: it confuses product allocation with financial planning. Real planning isn’t about chasing tax wrappers or maximising assets under management; it’s about aligning money with meaning — purpose, legacy, and the human capital that creates real wealth.
As inheritance tax reform looms, advisers tethered to AUM fees face a structural mismatch. Their income depends on clients keeping assets invested — but good planning may require the opposite: strategic gifting, decumulation, or reallocation outside platforms.
In short, ethical advice cannibalises its own revenue model.
The structurally trustworthy alternative
At the Academy of Life Planning, we teach planners to thrive beyond the AUM trap. Our practitioners charge for wisdom, not custody — for clarity, not complexity. The future belongs to those who help clients design lives, not just portfolios.
As the nation braces for November’s Budget, the message is clear:
The advisers who survive will be those whose value is measured in trust, transparency, and transformation — not basis points.
Call to Action
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