How simplified advice rules could boost your pension and investments

Investors could be able to access lower cost financial support on their pensions and investments under new simplified advice rules.

The Financial Conduct Authority (FCA) is building on its targeted support work by overhauling how consumers can access more straightforward financial advice on pensions and investments.

From 6 April, new rules will let regulated firms offer a type of help called ‘targeted support’ and make suggestions to groups of consumers with common characteristics such as those who could increase their pension contributions or hold too much cash in a current account.

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But the City watchdog also wants to help those who have specific needs but can’t afford a financial adviser.

It comes as FCA data shows that only a small proportion of UK adults receive regulated financial advice about investments, saving into a pension or retirement planning.

In 2024, only 8.6% of adults (4.6m) had received regulated financial advice related to investments, saving into a pension or retirement planning in the 12 months to May 2024.

Meanwhile, the use of artificial intelligence (AI) is increasing so the FCA said firms need to adapt.

This is where simplified advice comes in.

What is simplified advice?

Simplified advice is a more streamlined, lower-cost version of financial advice that is supposed to cater for straightforward needs where a full assessment of a consumer’s circumstances may not be required such as investing a lump sum.

Firms can already do this but many have complained that regulations are unclear and they don’t want to be at risk of being sued or of mis-selling.

How will simplified advice help investors?

The FCA has proposed making its regulations more clear so that regulated firms are more comfortable about providing simplified advice.

This includes replacing the requirement for advisers to consider “necessary” information with an expectation that advisers consider “sufficient” information. This should remove some of the paperwork involved in getting advice.

Investors also may not have to complete knowledge and experience assessments if a product is straightforward and it is assumed that they have limited experience.

Additionally, there could be simplified terminology on how a client’s risk profile is described.

Where an assessment of knowledge is required, the FCA said firms can educate and increase a client’s knowledge as part of that process.

The FCA said: “In combination, these changes should help reduce unnecessary friction for firms providing, and consumers seeking, straightforward advice on mainstream products, whose features and risks can reasonably be explained and understood by consumers with little or no experience of investing.”

Under current rules, regulated firms have to provide annual reviews for clients.

But the FCA has proposed moving to periodic suitability reviews for simplified advice and said firms can charge fees for both personal recommendations and related services on an ongoing basis.

It said: “We want to enable advisers to offer a broader range of ongoing advice services, with a range of fees to meet different clients’ needs.”

Sarah Pritchard, deputy chief executive of the FCA, said: “For too long the support people need to make important financial decisions has been out of reach for many.

“A market that provides good quality, lower cost simplified advice alongside comprehensive financial advice and targeted support will better support people making decisions about their financial lives. We want to see more people getting supported, who aren’t currently, and a market that innovates and offers tailored services to meet differing consumer needs.”

The consultation closes on 22 May 2026 and changes could be introduced by the end of the year.

Rob Hillock, head of personal financial planning at consultancy Broadstone, said the FCA’s plans are an important step towards closing the long-standing advice gap in the UK.

He said: “Too many people are making complex decisions about pensions, investing and retirement without any support, so creating a clearer framework for targeted support and simplified advice could significantly improve access to help.

“This could fundamentally change how people access financial help in the UK, moving the system away from advice being only for the wealthy towards more scalable support for the mass market.”