RDR – Will you pay for Financial Advice?
On the 31st December 2012 changes made to advice standards under the Retail Distribution Review (RDR) will mean that Independent Financial Advisors (IFA’s) are no longer able to claim commission on leads they generate for companies while offering financial advice to consumers.
What this means for consumers is that free financial advice will no longer be available through IFA’s in most situations. There will instead be a cost for the advice they give, which is likely to be charged hourly, and could feasibly be as much as £250 per hour.
Research from Deloitte has confirmed that 84% of people have no knowledge of the impending law changes, and what the implications of them are likely to be. The study from Deloitte included 2000 people and also confirmed that 54% of consumers would refuse financial advice if they are charged a fee.
Lead RDR partner at Deloitte, Andrew Power commented: “Deloitte’s research indicates that many consumers, particularly in the mass market, are unwilling to pay such fees”.
The changes are going to pose new challenges to banks, building societies and other financial services, which will likely have to work on finding new methods of distribution of their products as well as advisers, in order to convince consumers that paying for financial advice is worthwhile.
Nothing will be changing here at financialadvice.co.uk, however, where we will still offer free, no obligation advice from our FSA approved advisors.
Share this..
Related stories
Thoresen: National financial help service should be set up
A national service for people to share their money worries with experts has been recommended by the chief executive of insurer Aegon UK, Otto Thoresen.Mr Thoresen was hired by the treasury to conduct an investigation into the creation of the new body - and reported his findings yesterday.Support for the service was found by a poll conducted for the report - with 75 per cent saying that they would...
Read MoreUnemployment Set To Rise By 900,000 Over Next 2 Years
While many analysts have been trying to avoid the thought, it seems that the UK is headed for recession with news that unemployment is rising at the quickest rate since the last major recession of the 1990s. It has been reported that the number of unemployed rose by over 15,000 in June alone (the largest jump since 1992) and brings the number of job loses this year to 45,000.
Econo...
CBI expects 30,000 financial jobs to go in next six months
In a bitter blow to the UK financial sector the CBI has revealed expectations that 30,000 jobs could be lost over the next six months. When added to the 40,000 job cuts last year across banks, building societies, insurers and investment managers, this does not bode will have the future of one of the U.K.'s largest service sectors.
The CBI is also suggesting that profits and business...
Brown Tries To Gloss Over Darlings Remarks
Using a keynote speech at the CBI in Scotland we saw Gordon Brown looking more upbeat than he has for some time, more resilient and more candid in his approach to the struggle with the economy. While he has watered down his recent more optimistic tones he said that he was 'cautiously optimistic' that the UK downturn would be short and sharp, followed by a strong bounce. So what else did he have...
Read MoreHas Labour retaken Glenrothes?
The Glenrothes by-election has seen neither party convinced whether they have won or lost, so close is the vote in this Scottish heartland. While only a few weeks ago there seemed no chance of a Labour victory the sudden increase in Gordon Brown's worldwide popularity and the rescue package in the UK seemed to have come to his rescue. However, the SNP has been very active in the region and while t...
Read More