Paul Mitchell | Financial and Retirement Planning Coach
Find him here at: Your Smart Retirement Coach
Sarah stared at the letter from her financial adviser of twelve years. The words blurred as tears welled up – not from sadness, but from anger.
“Due to regulatory changes and evolving business requirements, we are refocusing our services on clients with investable assets exceeding £150,000. We regret that we will no longer be able to service your account.”
Her crime? Having “only” £120,000 in pensions and savings.
“I’m not poor,” she told me during our consultation. “I’ve saved carefully for 25 years. Now I’m being told I’m not worth their time. What happened to looking after loyal clients?”
What happened is a seismic shift in the financial advice industry that’s leaving millions of careful savers out in the cold. If you’ve been dropped by your adviser – or can’t find one who’ll take you on – you’re not alone. You’re part of the abandoned middle, and it’s not your fault.
The Brutal New Economics of Financial Advice
To understand why your adviser doesn’t want you, follow the money.
The financial advice industry has transformed beyond recognition since the Retail Distribution Review (RDR) in 2013. What seemed like consumer protection has created an unexpected consequence: advisers literally cannot afford to service clients with less than £150,000.
The Rising Cost Mountain
Running a financial advice firm today involves:
- Extensive regulatory reporting
- Mandatory professional indemnity insurance
- Continuous professional development
- Sophisticated compliance systems
- Detailed client documentation
- Regular file reviews and audits
Every client, whether they have £50,000 or £5 million, requires roughly the same time investment for compliance and administration. The difference? Revenue.
The Simple Maths:
- Client with £100,000 paying 1% annually = £1,000 revenue
- Time and costs to service properly = Often exceeds this
- Result: The adviser loses money
It’s not greed. It’s survival.
Richard, former IFA: “I hated dropping smaller clients. Some had been with me 20 years. But when my professional indemnity insurance hit £45,000 annually and I needed two compliance staff, the numbers stopped working. It was them or close the business.”
The Great Client Cull: Who’s Being Abandoned
This isn’t affecting a few unlucky people. It’s a mass exodus.
The New Minimums
Across the industry, minimum investment levels are rising:
- Regional IFAs: Often £150,000 minimum
- National firms: £250,000+ increasingly common
- Wealth managers: £500,000 to £1 million+
- Private banks: “Don’t call unless you have millions”
Who’s Getting the Letter
The Abandoned Middle includes:
- Successful professionals with £75,000-£150,000 saved
- Recent retirees with modest pensions
- Inheritors of “small” legacies (under £200,000)
- Divorcees with settlement shares
- Small business owners focusing on company not personal wealth
- Public sector workers with multiple small pensions
Margaret’s shock: “I’m a deputy head teacher. I’ve saved religiously. I have £95,000 across various pensions. Three advisers wouldn’t even meet me. When did £95,000 become nothing?”
The Real Cost of Being Advisorless
Being dropped isn’t just inconvenient. It’s expensive.
What Happens in the Void
Without professional guidance, abandoned clients often:
Stay in Expensive Old Pensions
- Jane discovered her 1990s pension charged 2.1% annually
- Modern equivalent: 0.4%
- Cost of staying put: £1,700 per year on £100,000
Miss Tax Opportunities
- David didn’t know about pension carry forward
- Lost opportunity: £40,000 extra tax relief over three years
- As higher-rate taxpayer, cost him £16,000 in missed relief
Make Emotional Decisions
- Peter panic-sold everything in March 2020
- Crystallised loss: £45,000
- Missed the recovery completely
- Still in cash earning 0.1% while inflation ran at 10%
Face Retirement Blind
- Susan approaching retirement with no withdrawal strategy
- No understanding of tax implications
- No protection against sequencing risk
- Flying blind into 30-year retirement
The Compound Effect
It’s not just one mistake. Without guidance, errors compound:
- Wrong pension stays wrong for decades
- Missed tax relief never recovers
- Poor investment choices drag on performance
- Retirement mistakes can’t be undone
The bitter irony: Those with less money need good advice more, not less. A 1% saving on fees matters more when you have £100,000 than when you have £1 million.
Why Robo-Advisers Aren’t the Answer
“Use a robo-adviser!” chirp the technology evangelists. “Problem solved!”
If only.
The Robo Reality Check
Robo-advisers promise automated wealth management for the masses. The reality?
What They Can Do:
- Basic risk profiling
- Generic portfolio allocation
- Automated rebalancing
- Low-cost investing
What They Can’t Do:
- Navigate pension consolidation complexities
- Identify valuable guarantees in old schemes
- Tax planning beyond ISA allowances
- Behavioural coaching during market crashes
- Retirement income strategies
- Handle anything unusual
Tom’s experience: “The robo-adviser put me in a 60/40 portfolio. Fine. But it couldn’t tell me whether to consolidate my five pensions, how to handle my divorce settlement, or whether I could afford to retire at 60. When markets crashed, I got an automated email saying ‘stay calm.’ Not helpful.”
The Human Element
Financial planning isn’t just mathematics. It’s psychology, emotion, life changes, complex decisions. No algorithm can hold your hand through a market crash or help you navigate the emotions of retirement.
The Alternative That Actually Works: Financial Coaching
Here’s where the story turns hopeful. A new model is emerging that serves the abandoned middle: financial coaching.
Understanding the Difference
Traditional Financial Advice:
- Recommends specific products
- Charges percentage of assets (1-3% initial, 0.5-1% ongoing)
- Requires minimum assets (typically £150,000+)
- Fully regulated with compensation schemes
- Adviser implements everything
Financial Coaching:
- Educates and guides without product sales
- Charges fixed hourly rates
- No minimum asset requirements
- Focuses on knowledge transfer
- You implement with confidence
Think driving instructor vs taxi driver. One teaches you to drive yourself; the other drives for you. Both have value, but only one is affordable for everyone.
The Cost Comparison That Changes Everything
Let’s use real numbers:
Traditional IFA Route (£150,000 pot):
- Initial advice: 3% = £4,500
- Annual charges: 1% = £1,500
- 10-year cost: £19,500
Coaching Route:
- Initial sessions: 4-6 hours = £400-600
- Annual review: 2 hours = £200
- 10-year cost: £2,400-£2,600
Saving: £17,000 over 10 years
That’s not a typo. Same guidance, different model, £17,000 stays in your pension.
What Coaching Covers
A good financial coach helps with:
- Understanding your current position
- Pension consolidation decisions
- Investment education (not recommendations)
- Tax efficiency strategies
- Retirement planning and income strategies
- Building financial confidence
- Creating action plans you can implement
Real Success: “After being dropped by my IFA, I was lost,” shares Michael. “Four coaching sessions gave me the knowledge to consolidate my pensions myself, saving £3,000 in advice fees and £800 annually in charges. I understand my finances now, not just follow instructions.”
The Coaching Journey: How It Works
Session 1: Discovery and Assessment
- Current position analysis
- Goal clarification
- Knowledge gaps identified
- Priority areas established
Session 2: Education and Strategy
- Investment principles explained
- Pension options decoded
- Tax strategies understood
- Retirement projections modelled
Session 3: Action Planning
- Step-by-step implementation guide
- Platform comparisons
- Cost analysis
- Risk assessment
Session 4: Implementation Support
- Questions answered
- Confidence building
- Progress review
- Future planning
Ongoing: Annual Reviews
- Strategy adjustment
- New legislation updates
- Life change adaptations
- Continued education
Elizabeth’s transformation: “I went from financial anxiety to confidence in four sessions. I now manage my own SIPP, understand my investments, and have a clear retirement plan. The IFA wanted £4,500 upfront. Coaching cost me £500 total.”
Taking Control: Your Action Plan
If you’re in the abandoned middle, here’s your roadmap:
Step 1: Don’t Panic
Being dropped doesn’t mean your finances are small or unimportant. It means the traditional model is broken, not you.
Step 2: Assess Your Needs
What do you actually need help with?
- One-off decisions (consolidation, retirement planning)
- Ongoing education and support
- Complete financial overhaul
- Second opinion on existing plans
Step 3: Understand Your Options
Full DIY: Cheapest but riskiest. Requires significant time and knowledge. One mistake can cost thousands.
Robo-Adviser: Good for basic investing. Limited for complex planning. No human support when needed.
New IFA: If you find one without minimums, check total costs carefully. Percentage fees add up.
Financial Coaching: Best balance of cost, support, and empowerment. You stay in control.
Step 4: Take Action
The worst response is doing nothing. Your finances don’t manage themselves, and problems compound over time.
Download my FREE Retirement Planning Checklist to start taking control today.
The Hidden Opportunity
Being dropped by your adviser feels like rejection. But it might be liberation.
For years, you’ve paid thousands in percentage fees for advice you saw once a year. You’ve been sold products you didn’t fully understand. You’ve been dependent on someone else for your financial confidence.
Now you can:
- Learn to manage your own finances
- Pay only for help when needed
- Save thousands in fees
- Build lasting financial confidence
- Take control of your future
Graham’s perspective: “Getting dropped was the best thing that happened to my finances. I discovered coaching, educated myself, and now save £2,000 annually in fees. I understand my money for the first time in 30 years.”
The Advice Gap Solution
The financial advice gap affects 12 million UK adults – people with modest wealth who need guidance but can’t access traditional advice. You’re not alone in this challenge.
Financial coaching bridges this gap by providing:
- Affordable access to expertise
- Education that empowers
- Support without dependency
- Guidance without product bias
- Knowledge that lasts a lifetime
As someone who spent 35 years in regulated financial services, I’ve seen this crisis develop. Good people with decent savings abandoned because they’re not profitable enough. It’s why I now focus on coaching – to serve those the industry has left behind.
Your Next Step
If you’ve been dropped by your adviser or can’t find one who’ll take you, you have options. The advice gap is real, but it doesn’t have to derail your financial future.
Financial coaching offers professional guidance at a fraction of traditional costs. No minimum assets. No percentage fees. No product sales. Just honest help when you need it.
I offer an initial FREE no obligation 15-minute consultation to start your journey toward financial clarity.
You can book your own consultation meeting with me here: https://yoursmartretirementcoach.co.uk/contact
Take Control Today
You’ve worked hard for your money. Don’t let the industry’s changing economics leave you vulnerable. Whether you have £50,000 or £500,000, your financial future matters.
Book your FREE 15-minute consultation to discuss:
- Your situation after being dropped or declined
- Whether coaching could help you
- What you need to move forward confidently
- How to bridge the advice gap
- Creating your action plan
No products to sell. No minimum requirements. Just professional guidance at an hourly rate you can afford.
Book Your Free Initial No Obligation Consultation Here Today
Because everyone deserves access to financial guidance, not just the wealthy.
About the Author
Paul Mitchell is a Financial and Retirement Planning Coach with over 35 years experience in financial services, including Chartered Financial Planner status. Through Your Smart Retirement Coach, he provides affordable coaching to those underserved by traditional financial advice, helping bridge the UK’s growing advice gap.
Disclaimer: This article provides educational content only and does not constitute regulated financial advice. Financial coaching provides guidance and education but cannot include specific product recommendations. For regulated advice, consult an authorised IFA. All examples are illustrative. Individual circumstances vary.
