“The increased qualifications, knowledge and embracement of financial planning has seen the evolution of the ongoing advice model, enabling firms and its constituents to become more recession-proof,” he said.
However, he added: “There is a strong belief that the RDR has created an advice gap. This is a complete myth as the evolution of the internet, MAS, and social media channels mean 'advice' is freely available and accessible faster than it has ever been before.
“One danger with this is the clouding of advice and guidance and I am happy the FCA insists advice must be accountable, culminating in a personalised recommendation.”
Ariyawansa said guidance is “mostly fluff” and this clouding encourages a significant number to believe that advice is “easy” and “should not cost more than a few bob”.
“Cost is the main objection, I find, when proposing a full financial plan for those who are cash rich yet asset poor,” he said.
He explained that another key danger is the emergence of the unregulated “advice-only” planner who purports to be better than advisers merely because they cannot recommend and implement a particular strategy using a product.
“It’s about as pointless as a doctor saying you have an infection needing antibiotics, yet cannot recommend which one to take, leaving the choice to you,” he said.
A qualified success
Felix Milton, chartered financial planner at Philip J Milton & Company described the post RDR reforms as positive in that fee transparency is now generally much fairer for clients and those seeking advice understand what they are paying for.
“That said, the FCA still has not worked out how to make full advice possible to those with fewer assets where typically the commission remuneration model worked for those individuals,” he said.
“I hope the FCA comes up with a plan as typically those with a lower amount of assets are those who could see the greatest benefit from financial advice.”
Meanwhile, Cooke said RDR has been “a qualified success” and has generally raised standards across the profession.
All advisers are now qualified to a higher minimum standard and more than ever have gone on to take higher qualifications which he said “can only be a good thing”.
Yet, he said: “The downside to that is it now takes longer to get into the profession than before so aspiring advisers have to factor in time, and cost, to qualify before they can start.
“Moving away from commission has also been a positive. A provider shouldn't be selected on the back of who pays the most to the adviser anymore, or who has the current special deal. It has also made the churning of bonds, that used to happen in the past, irrelevant.
