More people are turning to active, bespoke investment management services offered by advisers to manage their personal wealth, with this trend set to grow over the next two years, according to Rathbones.
The wealth and asset management firm said the findings reflect the efforts of increasing numbers of people across an ageing UK population to save for later life, many of whom are concerned they may not have enough resources to make the right decisions to live well in retirement.
Its research found almost half (46%) of advisers ask for a minimum portfolio of £400,000 to qualify for bespoke services, although 9% said they would offer the service to clients with between £250,000 and £300,000 in their investment portfolio. Almost all (93%) wealth managers and advisers who offer a bespoke investment management service typically use it to manage no more than a quarter of a client’s wealth.
Rathbones said its research found that the percentage of clients’ assets advisers manage through a bespoke investment management service has increased since 2023, with more than three quarters (77%) reporting an increase of up to 25%. Those advisers who don’t currently recommend bespoke investment management services expect to do so in the next four years.
Simon Taylor, head of strategic partnerships at Rathbones, said: “Bespoke investment management services offer financial advisers and wealth managers access to research capabilities and an ability to react quickly to changing market conditions and individual client needs, making them increasingly popular.
“With an ageing population in the UK, and people increasingly aware of the need to provide for their retirement, we’re seeing growing demand for such advice and support.”
Rathbones said the growth trajectory over the last two years is set to continue, with all advisers surveyed saying they predict a further increase in the percentage of clients’ assets managed through a bespoke investment management service between now and 2027.
One in five (20%) advisers expect an increase of between 5% and 15% of clients’ assets managed through a bespoke investment management service over the next two years, while 64% expect an increase of between 15% and 25% and around 13% of advisers expect an increase of between 25% and 50%.
However, all advisers agree that clients will need to have a bigger investment portfolio in the future to be considered for a bespoke service. Almost three in ten (28%) advisers say clients’ investment portfolios will need to increase by up to 15% to be considered in the next two years, whilst over half (52%) say they will need to increase by between 15% and 25%.
Taylor added: “Bespoke investment management was historically better suited to people with larger sums to invest because that invariably came with more complex tax circumstances.
“However, advisers and wealth managers are increasingly focussed on personalised and changing income profiles for people across their whole period of retirement. This requires a more dynamic approach to structuring investment portfolios and, as part of this response, we are broadening our offerings to support both individuals and their financial advisers.”
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