Lipstick on a pig – the sorry state of “robo-advice”


On 11th  and 17th of September, those turning up for the FT Adviser Financial Advice Forum in London and Birmingham respectively, will be entertained by a panel session.

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The conference promised to bring  the views of industry and regulatory experts on the latest challenges facing advisers, and how they can be overcome.

I had been invited and accepted because I do challenge the advisory community to raise its game.

I’m cross because I was originally on the “interactive panel” and appear to have been dropped (though I have not been informed of this by the FT).

I’m sad because this confirms what I have long suspected, that Robo-advice is being treated as nothing more than lipstick on the wealth management pig.

If you look at the three propositions on offer from WealthSimple, MoneyFarm and Holland Hann & Willis, you will find the same core model. Technology front end- wealth management back end.

All that technology is being used for – is to reduce the cost of acquisition of other people’s money. And the money that is being acquired forms part of the current wealth pool that is all that IFAs seem capable of feeding from.

Disruptors excluded

The FT seem to have excluded me from this cosy threesome because I might just point this out. They are right to do so, though why they ever thought I wouldn’t challenge the robo-advisory lip-stickery I do not know.

Every iteration of the Nutmeg model revolves around funding from a pool of assets attracted by an expensive UX (user experience for the uninitiated). But no matter how bright the lipstick, there is still a big fat wealth-management pig sitting behind – ready to chew up the twenty and fifty pound notes.

Meanwhile, the genuine innovators, whose models reach out beyond a replication of Nutmeg  are nowhere to be seen.

AgeWage – which was originally been invited has been dropped – no reason given

Pension Bee – who have produced the first genuine mass-market SIPP – are nowhere to be seen. Open Money – doing much the same.

My FutureNow -which only this week cut an important deal with L&G to be an independent aggregator and Zippen which should follow, are outside the tent.

And there are many more in incubation..

Financial advisors – cover your ears

Robo-advisers are not embracing new technologies to extend the scope of their advice, they are doing so to become more competitive in the existing wealth pool.

Meanwhile for the 94% of us who are not paying for advice, these new players are an irrelevance.

Organisations like the four mentioned above, who are looking to reach out to the millions of  savers who do not currently have access to the support they need to make complicated decisions are excluded.

I can only conclude that the tent is closed to all but the regulated advisers and that includes the 94% of us who are no closer to getting advice than we were “pre-Nutmeg”.

Financial advisers – (cover your ears) –  you don’t really matter to most of the UK population and that isn’t going to change so long as you zip up your tent.

Opening up the tent

Eventually, the FCA, MAPS and tPR will find a way to broaden the scope of advice beyond those with the wealth to pay for it.

But that day is some way off.

The  innovators are excluded from the FT Financial Advice Forum  

But it is only a matter of time before the tent is opened up. I will keep up the pressure and so will those who genuinely want open pensions and open dashboards providing ordinary people with the information they need to take decisions.

And AgeWage will never exclude financial advisers from joining in our work.



About henry tapper

Founder of the Pension PlayPen,, partner of Stella, father of Olly . I am the Pension Plowman
This entry was posted in advice gap, age wage, pensions and tagged , , . Bookmark the permalink.

4 Responses to Lipstick on a pig – the sorry state of “robo-advice”

  1. John Mather says:

    Don’t worry Henry the IFA numbers are falling partly due to the demographics but mainly due to the lack of profitability in the trade. You only need to look at the offices some occupy to see which sector of the parasites on savings occupy to see where the money from pensions goes and since IFAs only deal with 6% I don’t know why this blog dedicates more than 50% of the column inches to them How does the AgeWage score look for the 6%? My own experience would be upper decile in VFM and better for fund size achieved per individual.

  2. Robert Davies says:

    Comments are always welcome when they agree witth mainstream narrative.
    When they don’t; not so much.

    • henry tapper says:

      I welcome all comments so long as they are meant well. John is a co-director of AgeWage and someone I have enormous respect for – we often disagree and our disagreements always inform each other’s positions,

      Your comments are welcome too!

      • John S Mather says:

        Henry, If we agreed on everything one of us would be unnecessary

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