One in four financial advisers believes that the FCA’s plans to introduce ‘targeted support’ to widen the availability of financial guidance to millions may have a negative impact, according to a major new survey.

Thousands of advisers believe the plans, part of the government’s advice-guidance boundary review currently under way, are sceptical about the FCA proposals.

Some 25% of advisers disagree that targeted support will have a positive impact on consumer finances and may even “confuse” consumers and make their situation worse.

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The FCA is currently reviewing the Advice-Guidance Boundary with a view to potentially allowing new types of support for consumers who cannot afford full Financial Planning Advice. This could include ‘targeted support’ which would enable financial firms to offer consumers some guidance on their finances without giving full financial advice.

Despite the survey findings, half of advice firms says they are “likely” to offer some kind of targeted support services, according to the Advice Gap survey by financial consultancy the Lang Cat which surveyed 2,045 advisers and 210 advisers.

The survey also found that the Consumer Duty changes in 2023 appear to have driven a new ‘advice gap’ with many advisers dumping unprofitable clients due to costs and complexity rising. Half of advice firms have withdrawn advice for up to one in five of clients.

According to the survey, professional financial advice is paid for by just 9% of the population with a lack of trust in advisers and concerns about adviser value holding back many consumers from using advisers.

Key findings from the report:

• Just 13% of consumers would find ‘targeted support’ valuable and act on instructions given from an investment provider  
• One in four advisers do not think the targeted support proposals will have a positive impact on consumers 
• Just 9% of the UK population use professional paid-for financial advice 
• 91% of those who took financial advice found it helpful
• Lack of trust in advisers and value perception are the biggest barriers for consumers – 31% and 33% respectively  
• Two years in, the Consumer Duty regulation has created an ‘accidental advice gap’ with half of advice firms withdrawing services for up to 17% of clients 
• Advisers are optimistic about the potential for digital channels to open up support for less well off 

The study also looked at the impact of the two-year-old Consumer Duty on advisers’ businesses. Two thirds said regulation was making it harder to serve less wealthy clients. Half reported stopping services with ‘accidental advice gap’ clients making up an average of 11% of their customer base and rising to 17% for smaller firms.   

When asked about the potential to offer advice services through digital channels, over 55% of advisers said these would expand their customer base with 30% able to service less wealthy clients. 

Mike Barrett, consulting director at the Lang Cat, said: “Just 9% of the population has benefitted from paid for advice over the past two years and as an industry, we all aspire for that figure to grow. Despite the headline, there is lot to be positive about. The fact that an overwhelming 91% of those who took advice found it helpful, shows levels of customer satisfaction that any other profession would dream of.  

“Two areas of concern remain - firstly the alarming lack of awareness among the majority of the population as to the benefits of financial advice. And secondly, how the profession is increasingly focused on a narrow segment of the population – wealthy individuals over 50 who are edging towards retirement. 

“This isn’t a criticism of the advice profession – the need to service this group is entirely logical and sensible. However, the advice gap is most pressing for those who fall outside of this segment, and we believe there is value in understanding the scale of the problem. Only then can we figure out what interventions if any are needed so that we can start to tackle the advice gap once and for all.”   

• All figures, unless otherwise stated, are from YouGov Plc.  Consumer sample size was 2045 adults. Fieldwork was undertaken between 8-9 April 2025.  The survey was carried out online. The figures have been weighted and are representative of all GB adults  (aged 18+). Adviser research was conducted via the Lang Cat Adviser Research panel during March 2025, with 210 responses received. 

• Financial Planning Today Analysis: The Lang Cat survey reminds us of a lot of what we already know, for example that few people pay for professional financial advice, and some things we didn't know, for example that the Consumer Duty may actually have resulted in fewer people getting advice (some suspected this but few figures were available). As the FCA moves towards allowing targeted support and blurring the advice-guidance boundary, it seems likely that it will not be long before we see many new targeted support services being launched. Many will be from providers but it also appears advice firms are looking at the opportunities too. For most Financial Planners it will be business as usual as they concentrate on better off and wealthy clients who appreciate them and are able to afford their services. This will have little to do with targeted support offerings but the move to targeted support may well nudge a few consumers to think more widely about using a Financial Planner. What the survey does reveal, however, is the sorry state of mass market financial guidance provision in the UK. Professional financial advice or financial guidance is simply out of the reach of the vast majority of the population or not available and that needs to change.