The UK’s FCA has announced proposals that will make it easier for people to receive and act upon financial advice, in what is is presenting as a bid to enable millions of people to better navigate their financial lives and get support on pensions and investments.

The regulator said in a press release on Monday its new proposals “would allow firms to offer a new type of help called ‘targeted support’ and make suggestions to groups of consumers with common characteristics. These could include people who may be currently drawing down on their pension unsustainably, not saving enough for retirement, or who have excess cash sitting in a current account.”

Growth agenda

Growth, the buzz world in the government’s economic corridors these days, is understandably part of the regulator’s proposals, given the pressure it’s facing from politicians to do more on that front. And in order to deliver on the government’s growth agenda, the FCA’s proposals are aimed at encouraging people with excess cash in their current accounts to invest with confidence.

“There are about 7 million adults in the UK with £10,000 or more in cash savings who may be missing out on the benefits of investing throughout their lives,” the FCA has said.

The plan, on paper at least, is to provide bespoke financial advice on how this demographic can invest smartly and increase their wealth – termed as “targeted support” in the new proposals.

Sarah Pritchard, deputy chief executive of the FCA, said: “These once-in-a-generation reforms will help people navigate their financial lives and give them greater confidence to invest. This is a win-win for consumers and firms alike.”

The proposals seem to have the support of the government too, with Chancellor Rachel Reeves saying the reforms “will make a real difference to help working people make better long-term financial decisions, ultimately putting more money in their pockets as part of our Plan for Change.”

Encourage to invest

Over the past year the FCA has received constant pressure and criticism from the government as well as parliament to do more to boost economic growth. Earlier this year, the regulator announced its new five-year strategy, with a clear commitment to boosting growth. In January, CEO Nikhil Rathi sent a letter to the Prime Minister, spelling out almost 50 initiatives it would undertake to achieve certain goals.

The latest proposals are aimed at people who hold cash savings but are unsure, unaware, or simply lack confidence when it comes to investing their wealth.

The FCA has said the findings of independent research it commissioned shows that “more than half of savers (54%) would welcome ‘a lot’ or ‘a little help’ and support when they need to decide whether to invest excess savings. In addition, 62% of existing investors would welcome more help and support when it comes to managing their investments, and 68% of existing investors would welcome more help and support when reviewing investments to make sure they are right for them.”

“This is a win-win for consumers and firms alike.”

Sarah Pritchard, deputy chief executive, FCA

Separately, the FCA’s Financial Lives Survey 2024 revealed that just 9% of adults received financial advice about their pensions or investments in the 12 months leading up to the survey.

Of those who did not receive financial advice, but hold £10,000 or more in cash savings:

• 24% said they don’t invest because they don’t know enough about it;
• 12% said they don’t invest because they feel overwhelmed by the number of options available;
• 8% said they would need more support before they invest.

According to the regulator, these findings show that there is a stark ‘advice gap’ in the way people receive support and guidance around their financial lives.

It says the proposals are meant for long term and will set out the framework for the next 20-30 years, enabling people to receive support and guidance they need, at a time they want it, and at a price they can afford.

The proposals are now open to consultation, with the process closing on August 29, 2025. The FCA has said it aims to publish a policy statement by the end of 2025.