From Advice Gap to Investment Gap Filler: FCAs New Plan Could Actually Work

As reported in the Financial Times, the FCA has just lobbed a regulatory grenade into the advice market and, for once, it might do some good.

Their proposal? A new regime of “targeted support” and “simplified advice” that lets firms like Vanguard and Hargreaves Lansdown give generic nudges to savers without needing a 40-page suitability assessment and a £2,000 advice fee. The goal? Help the 13 million people with six months of savings languishing in cash - and no plan - do something better with it.

It’s the regulator’s big swing at the “advice gap” left behind by RDR over a decade ago. Back then, we got higher advice standards and a much smaller audience who could afford it. Now, we’re promised a middle ground: more than a robo-calculator, less than a full-fat IFA.

If this works, it could unlock billions in dormant cash, giving people access to long-term investing maybe even employee share plans (SAYE anyone?) as part of a wider retail investment strategy. Because while ISAs and index trackers are great, workplace equity remains the most overlooked wealth-building tool in the country.

Will it work? That depends on whether the “support” is genuinely helpful or just product placement with a light dusting of compliance. But let’s be optimistic: this could be a huge win for consumer access, financial literacy, and the share-owning democracy we keep pretending we want.

One to watch. And maybe one to shape.