The financial advice market continued to show healthy signs of growth in 2016, Aviva’s Adviser Barometer found.
The income of over 30% of advice firms passed the million pound barrier, compared with 26% last year.
The number of advisers planning to recruit staff in 2017 is the highest since the survey began, with 45% intending to do so, compared with 40% a year ago, and only 31% in March 2013.
Economic uncertainty and market volatility
The number of advisers viewing economic uncertainty as a key concern doubled in 2016 from 21% in 2015. The same number also cited the impact of Brexit as one of their biggest concerns, with 39% also seeing the Trump victory in the US election potentially having implications for the advice industry.
Tim Orton, chief executive of Aviva Adviser Platform, said: “It is no surprise that the sentiment reflected in our latest Adviser Barometer reflects the general uncertainty we’ve seen since the UK vote for Brexit and the Trump victory in the US election.
"In line with the survey findings we are seeing an increasing number of advisers concerned about the financial stability of their platform as part of their due diligence.”
"In both cases, we are stepping away from the status quo, which inevitably invites speculation as to possible outcomes.”
There has, however, been little actual change in adviser or client behaviour since the 23 June Brexit vote.
- 84% of advisers report no additional demand attributable to the Brexit vote, and where this has been seen it is largely from clients requiring assurance only (77%).
- 78% of advisers say their main concern about Brexit is potential market volatility, and a further 35% say changes in regulation concerns them.
- Only 2% of advisers have reviewed their providers following the Brexit vote, with advisers saying the main reason for staying put is wanting to use firms with more stability (46%), wanting to use UK-based firms (18%), and using firms with a diversified business (16%).
Orton said: “The most concerning factors for advisers in the next six months are the ramifications from Brexit and Trump’s presidency, but factors which advisers can control, such as remaining profitable, have become less of a concern for them. I think this is also a reflection of the way the market has grown and strengthened since our survey began back in December 2011.
“What is coming through strongly is advisers saying they are putting measures in place to make sure they are in as good a place as possible to meet whatever challenges occur in the coming year – by sticking with financially strong, secure, diversified UK-based companies.”