In the Financial Advice Market Review (FAMR) issued by the government earlier this year there was a recognition that with increased complexity in pension savings, increasing longevity and the prevalence of defined contribution pensions, more people now need guidance and advice.
However, this report produced by the Treasury and the Financial Conduct Authority, also recognised that some people may only need limited advice or guidance but that consumers and regulated advisers would then need some strict rules around what constitutes advice, guidance and limited advice.
Certainly, the marketplace does not make it easy for consumers with services like the Money Advice Service which absolutely does not provide any form of advice - limited or otherwise - to its users, yet it includes the word 'Advice' in its name. Likewise, do consumers who use online advice models or 'robo' advice feel they are being guided or advised?
To assist consumers, employers and providers in clarifying which providers can deliver such services and their specific responsibilities under each of these services, the government has recently opened a consultation around these issues. This is due to close on 15 November and so we may hear something of the conclusions and findings in the Chancellor's Autumn Statement or shortly after that.
In August 2015, the government launched the Financial Advice Market Review (FAMR) to explore how consumers could access help with their finances more easily. FAMR was a joint review between HM Treasury and the Financial Conduct Authority (FCA). FAMR examined the regulatory framework governing the provision of financial advice and guidance and its effectiveness in ensuring that consumers have access to the help they need in order to make effective decisions about their finances. Consumers seek financial advice for a range of different reasons, including for investments and insurance. FAMR sought evidence from consumers about the barriers they face in seeking advice, the value they place on it and how easy it is to find advice and understand it.