Almost all (97%) independent financial advisors surveyed expect demand to rise for bespoke portfolios managed by third party wealth managers, due to the increasing complexity of navigating issues around family inheritance, a new study has shown.
Research from Rathbones Group, one of the UK’s leading wealth management firms, found advisers are finding it increasingly challenging to manage larger client portfolios, and deliver growth and tax efficiency to their clients, following changes to tax relief on pensions and estates.
Two out of three (65%) say portfolio management has become more difficult, with less than a third (29%) saying it has become easier. A contributing factor identified by the study is the growing complexity in decumulation strategies and estate planning because of last year’s Autumn Budget. Around 93% of advisers questioned say that it is driving increased interest in bespoke investment services.
Simon Taylor, Head of Strategic Partnerships and Platforms, Rathbones, said: “Changes in last year’s Budget to IHT are having a major impact on advisers and their clients with large investment portfolios, with advisers finding managing both growth and tax efficiency more challenging as a result. Furthermore, the FCA’s thematic review on retirement income advice, published in March 2024, is adding increased impetus for adviser businesses to think carefully about investment propositions for their clients, resulting in increased interest in bespoke services.”
Most advisers who offer bespoke investment services are more likely to do so for decumulation – around 59% questioned do so, while 41% are more likely to offer them during the accumulation phase. In terms of timing, the study found 39% are more likely to offer bespoke services to those clients approaching retirement while 15% do so for recently retired clients and 5% for those who have been retired for some time.
