Adviser confidence around the ability to deliver value to clients remains strong in 2025, but technology and regulation are both weaker points, says NextWealth.
The findings are part of NextWealth’s Financial Advice Business Benchmarks report, which explores advisers’ confidence across five core components; clients; people and capacity; business strategy and growth; markets and regulation; and tech and efficiency.
Advisers rated their ability to understand, serve and deliver value to clients the highest at 4.3 out of 5. People and capacity followed at 4.2, while confidence in business strategy and growth came third with a rating of 4.
The report showed nearly half (47%) of respondents are working with more clients this year and segmentation is shifting toward ongoing advice needs. Meanwhile, a centralised approach to the investment proposition has become the norm, and further growth is expected in the use of discretionary model solutions.
But despite growth in client numbers, hiring intentions have softened. Only a quarter (27%) of firms plan to grow by adding to their headcount, down from 40% last year. NextWealth said this shift could be as a result of adopting more tech.
Heather Hopkins, managing director at NextWealth, said: “The tech effect is not a cull. Firms aren’t ‘replacing people with AI,’ but we hear that they re-evaluate backfills when someone leaves, asking whether automation and AI tools now remove or reshape the role.
“And it seems reports of the death of the paraplanner have been greatly exaggerated. Thirteen percent of those who are hiring are looking for qualified paraplanners.”
NextWealth said its research also showed that confidence in personal career prospects is the strongest individual aspect in 2025, with 60% fully confident compared to 48% last year.
However, technology remains an area that advisers are less confident about (3.6), closely followed by regulation (3.5).
Hopkins said: “Behind the benchmarks, financial advice professionals describe a rolling tune-up of the advice engine: standardising journeys, wiring systems together, and improving data fidelity. Data quality, however, remains a sticking point for realising the admin efficiencies tech and AI can offer.
“Poor data quality is to efficiencies what driving with the handbrake on is to fuel economy and it’s not an issue that is going to go away.”
The report found integration remains a key challenge for firms. While a number of firms are imposing structure on meeting notes to improve extraction, in many cases current AI implementations are another layer outside the existing stack.
Hopkins said: “Our takeaway from recent conversations is that integration only works if your data model is right. Sometimes the reason integrations keep falling over isn’t API problems; it’s inconsistent fields and definitions. If systems don’t share the same core fields and definitions, APIs just move mess around faster.”
The report also looked at appetite for targeted support. It found that nearly half of firms surveyed are not considering offering it, while one in four said it’s too soon to tell. Just 4% are actively exploring offering targeted support, rising to 9% among those who work at firms with more than 50-client facing advisers.
“In practice, it’s seen as a vertically integrated play, where product fees can fund the service; most advice firms can’t make the economics work,” Hopkins added.
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