Nearly 25% of advisers consider departing the industry
Despite over 12,000 financial advisers leaving over the last four years, Adviser Ratings reveals that almost a quarter are thinking of following suit in 2023.
According to Adviser Ratings, 11% of advisers planned to exit the profession in 2023, alongside 12% who felt uncertain whether to remain or seek work elsewhere.
The annual landscape report pleasingly noted that 77% of advisers intended to stay this year.
Their findings followed previous reports of some 2,000 advisers who resigned throughout 2022.
In anticipation of the Government’s Quality of Advice Review, the report recognised the issues advisers faced surrounding rising compliance and insurance costs whilst balancing profit levels.
As a result, over 90% of adviser practices expressed plans to increase their fees during 2023 to parallel growing costs.
When Adviser Ratings asked if they intended to remain at the same licensee, three-quarters of advisers said yes whilst one-quarter were either planning to switch or were uncertain.
Those who expressed plans to switch represented the diversified licensee segment, with more than 50% of that cohort intending to apply for their own licence.
Moreover, approximately one-in-seven advisers with boutique or solo licensees planned to switch during 2023. All of these respondents indicated plans to sell their licence due to rising costs.
Although licensee switching would occur, the firm expected a “quieter year” for industry movement, with 2022 recorded as the slowest year since 2014.
Adviser Ratings previously forecasted adviser numbers to settle around 13,000 by the end of 2025. With new regulation on the horizon and a slowdown in those exiting the profession, the firm hoped to hit the low point sooner rather than later, with recovery to follow after.
AUTHOR
Jasmine Siljic
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