News, Culture & Society

Call for savers to get cheaper advice on investing

Call for savers to get cheaper advice on investing: FCA proposing new rules to help people who want to invest in an Isa and need a hand

Millions of savers may soon gain access to low-cost financial advice – helping them to invest their nest eggs for the first time. 

The city watchdog, the Financial Conduct Authority (FCA), is proposing new rules that would allow more banks, building societies and advisers to offer affordable advice to people who want to invest in an Individual Savings Account (Isa). 

Changing the rules: Many lack the confidence to invest themselves and cannot afford to pay for the necessary advice

Close to ten million people have more than £10,000 held largely in cash, where its value is being eroded by rampant inflation. Almost half of these would be willing to invest some of their money in the hope of a higher return, but many lack the confidence to do it themselves and cannot afford to pay for the necessary advice. 

The FCA hopes to address this by making simple advice cheaper to access. If the plans go ahead, they will be implemented in April 2024. 

Savers with up to £20,000 to put into an Isa could get a form of streamlined advice under the new rules. 

Costs would be kept down by limiting the number of investments offered, lowering the level of qualifications that advisers are required to have, allowing savers to pay for advice in instalments and permitting professionals to offer advice without first looking into every aspect of the saver’s finances. 

The FCA admits there is a risk that those with complex finances may use the new simplified service, rather than seeking the full advice they require. 

Tom Selby, head of retirement policy at investment platform AJ Bell, warns advisers may not be keen to offer this cheaper advice. He says: ‘If something goes wrong, it is the firm offering the advice that will be on the hook.’

***
Read more at DailyMail.co.uk



Find local lawyers and law firms at USAttorneys.com