Talk to us

Regulation Round Up – February 2025

By
Team We Complement

News

Welcome to Regulation Round Up! This monthly briefing is your go-to resource for the latest regulatory updates in financial services. Each edition, we highlight key developments from HMRC, the FCA, and beyond—helping you navigate the evolving landscape with confidence and stay ahead of industry changes.

 

FCA Sets Out Proposals to Open Up the Bond Market

The FCA is currently consulting on plans to reduce costs and lower barriers for companies seeking to raise capital by issuing bonds. According to the FCA, “the aim is to encourage companies listed on stock exchanges to offer bonds in smaller sizes, thereby improving investment opportunities for wealth managers and retail investors. More flexible and affordable capital raising should support the growth of UK listed companies.”

The proposals are designed to enable companies to offer larger quantities of shares or bonds to a broad investor base outside of public markets through an authorised firm—much like the approach taken by crowdfunding platforms.

Read more on the FCA’s website

 

Treasury Committee Begins New Inquiry into the Use of AI in Financial Services

The Treasury Committee has opened a call for evidence regarding the use of artificial intelligence in banking, pensions, and other financial services. The inquiry aims to understand how AI can be utilised for innovation while ensuring robust consumer protection.

Key areas of focus include:

  • How AI is currently being used in financial services.
  • Opportunities for innovation and its impact on employment.
  • Comparative analysis of the UK’s approach versus international methods.
  • Consumer risks, especially for vulnerable groups, and the potential effects on financial stability and cyber security.

Find out more about the inquiry

 

Reminder: Deadlines for Lifetime Allowance Protections and Enhancements

Pensions Scheme Newsletter 166 (issued at the end of January) reminds us of the upcoming deadlines for lifetime allowance protections and enhancements. Please ensure that any clients affected by these changes submit their applications before the deadlines:

  • Fixed Protection 2016 and Individual Protection 2016: Deadline: 5 April 2025
  • International Enhancements for Overseas Individuals: Overseas individuals with accrual under a registered pension scheme, or transfers from a recognised overseas pension scheme, who wish to apply for international enhancements must do so by the earlier of the following: either the 31st of January following the end of the tax year, five years after the end of the tax year in which the accrual period ends or in which the recognised overseas scheme transfer took place, or the 5th of April 2025.
  • Pension Credit Enhancements from Previously Crystallised Rights:Apply by the earliest of the following: Either the 31st of January following the end of the tax year, 5 years after the end of the tax year in which they legally became entitled to the pension credit, or the 5th of April 2025.

Read the full details on the GOV.UK website

 

Recent FOS Decisions

This month, we take the opportunity to review some recent decisions by the Financial Ombudsman Service (FOS). These decisions are invaluable for financial planners and paraplanners alike, offering insight into the considerations and rationale behind complaint resolutions.

FOS decisions can be really valuable reading for anyone who works in the financial planning world, and we recommend that all paraplanners, in particular, take a look at some recent decisions from time to time. You might find some of the decisions and the rationale given to be surprising. Regardless of whether you agree with the decisions made by the FOS, looking through their decisions gives a really interesting insight into the sort of things they look at when investigating a complaint. We’ve found this to be invaluable when writing suitability reports, and it helps you think critically about the processes and procedures that are in place where you work, and how they would be perceived by an external person.

DRN-5161884

This decision concerns a client’s complaint about the service received from his financial adviser, specifically challenging the perceived disproportionate charges relative to the level of service provided. The complaint was not upheld. The ombudsman’s rationale highlights the importance of something we mention often: evidencing the suitability of your advice. Without the adviser’s good record keeping, the outcome could have been different.

In a nutshell, the client said that he had incurred significant charges since the adviser has been managing his pension, and over that time there had been no fund switches made. He felt that the reviews were “tick box exercises” and he was not happy that his pension hadn’t achieved the same performance as the FTSE All Share Index.

As evidenced by the client file, the adviser had offered to re-assess the client’s risk profile on two occasions, had discussed the option of other investments, and had proposed discretionary management to the client to provide the level of active management he was seeking. The client declined these options.

Keeping your files well-organised, including maintaining records of conversations with clients, is key to making sure that you understand your client’s thoughts and needs, and adds an extra layer of protection for you. If you need help with making sure you have the right processes in place, get in touch.

 

Strengthen Your Practice with Robust Record-Keeping

Don’t let disorganised files and incomplete records jeopardise your professional standing. Maintaining comprehensive, up-to-date documentation is essential—not only for regulatory compliance but also for building trust and clarity with your clients. If you’re looking to refine your processes or need expert guidance on best practices, we’re here to help.

Get in Touch:

  • Schedule a Free Consultation: Let’s discuss how to optimise your record-keeping and compliance processes.
  • Tailored Support: Receive personalised advice to ensure your documentation practices meet the highest industry standards.
  • Secure Your Future: Proactively safeguard your practice and enhance your client relationships by working with our experienced team.

Contact us today to find out how we can help you streamline your operations and protect your business.

 

As we kick off the new year, financial markets are proving as unpredictable as ever. While 2024 ended on a high, driven by optimism around artificial intelligence (AI) and economic resilience, 2025 has already thrown up fresh challenges. A major selloff in U.S. tech stocks, renewed trade tensions between the U.S. and China, and signs of market fatigue in high-growth sectorshave all contributed to a more cautious investment landscape.

This month, we break down the key market developments shaping investor sentiment and how asset managers are adjusting their strategies in response.

 

Tech Stocks Take a Hit – Is the AI Hype Fading?

AI was the defining investment theme of 2024, with companies like Nvidia, ASML, and Broadcom leading the charge. However, January 2025 has been a stark reminder that even the strongest bull runs aren’t immune to corrections.

The biggest shock came from Nvidia’s record single-day loss, wiping billions off its market value. The trigger? The rise of DeepSeek, a Chinese AI startup that has disrupted the narrative around AI development. DeepSeek has introduced AI models that rival Western chatbotsat a fraction of the cost, challenging the idea that AI progress depends on ever-increasing computing power and energy consumption.

This has spooked investors, many of whom had priced Nvidia and its peers for near-perfection. With lower-cost competition now entering the scene, the market is beginning to rethink AI valuations.

However, not all tech firms are feeling the pressure. AI integrators—companies that use AI rather than build it—could actually benefit from increased competition in the space. Lower costs mean AI adoption could accelerate across industries, boosting demand for companies that apply AI rather than those solely focused on hardware. Apple, for example, gained 3% this month, reclaiming its title as the world’s most valuable company.

 

Trump’s Trade Moves – Déjà Vu for China Investors?

Adding to market uncertainty, President Donald Trump has proposed new tariffs on Chinese imports, reigniting concerns about a U.S.-China trade war.

Some investors are worried this could hurt Chinese equities, but history suggests otherwise. Back in 2018, when the first round of tariffs was introduced, markets initially reacted negatively. But from late 2018 to mid-2021, Chinese stocks staged a strong rally, proving that domestic factors tend to have a bigger impact on China’s markets than external pressures.

The same may hold true today. While tariffs can create short-term volatility, China’s own policy decisions, economic data, and corporate earnings are far more important in determining the long-term direction of its stock market. Investors with a longer-term horizonshould keep this in mind rather than panic over immediate headlines.

 

Portfolio Positioning – How Asset Managers Are Responding

Given these market shifts, fund managers are making some key adjustments:

1. Reducing Equity Exposure

With macroeconomic uncertainty rising and tech valuations coming under pressure, asset managers—including HSBC’s Multi-Asset investment team—have been scaling back their equity exposure. This doesn’t mean abandoning stocks entirely, but rather trimming positions in overvalued areasand keeping more cash on hand for future opportunities.

2. Adding More Bonds (Duration Exposure)

To offset equity market volatility, there has been an increase in bond exposure. With interest rates potentially peaking, long-duration bonds provide a buffer against further market fluctuations.

3. Being Selective in Tech Stocks

HSBC remains cautious on high-valuation AI chipmakers but still sees potential in companies that apply AI rather than just build it. With DeepSeek and other challengers entering the scene, competition is heating up—meaning not all AI stocks are created equal.

4. Keeping a Balanced Approach

In HSBC’s Global Strategy Portfolios, Nvidia exposure ranges from 0.61% (Cautious Portfolio) to 2.95% (Adventurous Portfolio). While Nvidia remains a key player in AI, the fund managers are ensuring their portfolios remain diversified and not overly concentrated in a single high-growth theme.

5. Staying Opportunistic

With market sentiment shifting, asset managers are closely watching for attractive entry points. The recent tech selloff may create buying opportunities in high-quality names, but patience is key. Overpaying for growth stocks has burned investors before—and could do so again.

 

Final Thoughts – A Volatile but Exciting Year Ahead

So, what should investors take away from all this?

  • AI is evolving fast, and not every tech leader today will stay on top forever. The emergence of new competitors means investors need to differentiate between companies driving innovation and those merely riding the wave.
  • U.S.-China trade tensions will continue to grab headlines, but historical trends suggest China’s markets are more influenced by domestic factors.
  • Markets are adjusting to a more uncertain landscape.Asset managers are taking a more cautious approach, balancing risk and reward while waiting for the right opportunities to deploy capital.

While 2025 has started on shaky ground, disruptions also create opportunities. The key for investors is to stay informed, be selective, and avoid getting caught up in short-term market noise.

If you’d like to discuss how these market trends impact your clients portfolio’s or explore investment opportunities, feel free to reach out. Staying ahead in today’s market means making informed decisions—and  We Complement  are here to help.

Welcome to this month’s edition of Specialised Investments Simplified, designed to provide financial advisers with the latest insights and actionable updates on key investment topics. This edition covers developments in inheritance tax (IHT), Venture Capital Trusts (VCTs), Enterprise Investment Schemes (EIS), emerging markets, and the strategic role of gold for 2025.

IHT Receipts Soar to £6.3 Billion – A Record Year Ahead

With IHT receipts hitting £6.3 billion, the Treasury is set for a record-breaking year. The frozen nil-rate band and rising property values continue to leave clients exposed to increasing IHT liabilities. Additionally, the industry warns that IHT on pensions could create “significant problems” for clients who have relied on these assets as part of their estate planning strategy. Now, more than ever, robust estate planning advice is essential to help clients mitigate their exposure.

Explore the IHT trends further here.

VCTs: Beyond Size and Age

As Venture Capital Trusts celebrate their 30th anniversary, their relevance remains strong. While the size and age of a VCT often influence client confidence, advisers should note that success increasingly depends on the expertise of the management team, the quality of deal flow, and portfolio diversification. With tax-efficient opportunities still in demand, VCTs offer a compelling solution for clients seeking growth-focused investments.

Learn more about what makes VCTs successful.

Review 30 years of VCT progress.

Is EIS the Right Fit for Your Clients in 2025?

Enterprise Investment Schemes (EIS) continue to provide tax-efficient growth opportunities, particularly for clients willing to embrace higher-risk investments. With Income Tax relief, CGT deferral, and potential Inheritance Tax benefits, EIS may present a timely solution for clients seeking diversification while optimizing their tax position.

Read why EIS could be a strong addition to client portfolios.

Navigating Emerging Market Volatility Driven by US Policy

Global Emerging Markets (GEMS) remain under pressure due to U.S. policy-driven volatility. Shifts in monetary policy, geopolitical tensions, and trade dynamics are creating challenges—but also opportunities. Advisers should carefully evaluate how these trends could impact client portfolios and whether exposure to GEMS remains aligned with their risk appetite.

Dive deeper into the implications of US-driven volatility on GEMS.

Gold in 2025: A Strategic Anchor for Portfolios

Gold remains a strategic asset in uncertain times, offering diversification and a hedge against volatility. The World Gold Council’s 2025 outlook emphasizes gold’s continued relevance for client portfolios, particularly given macroeconomic uncertainty and shifting market dynamics. For advisers, gold can provide an effective way to mitigate risk while enhancing portfolio resilience.

Explore the latest research on gold’s role in 2025 portfolios.

Supporting Your Clients in 2025

The evolving investment landscape presents both challenges and opportunities. As advisers, ensuring clients are informed and well-positioned to navigate these developments will be key to delivering value. Whether it’s addressing IHT exposure, exploring VCTs or EIS, or rebalancing portfolios with gold and emerging markets, staying proactive will set you apart.

We’d love to hear your thoughts or questions—join the conversation on our LinkedIn page.

How Can We Complement?

 

Welcome to the January edition of Tech Talk. In this issue, we focus on how AI is transforming the financial services industry. AI-driven tools are making remarkable progress in streamlining operations, improving compliance, and enhancing customer experience. From meeting transcription to personalised suitability reports, these tools are enabling businesses to operate more efficiently, reduce costs, and deliver better outcomes for their clients.

AI Tools Revolutionising Financial Services

The integration of AI into financial services is unlocking new levels of efficiency and accuracy. Key players such as Fireflies.ai, Saturn, Aveni, Timeline, and Avenir are at the forefront, automating tasks, enhancing compliance, and enabling professionals to focus on high-value activities. Like many businesses, we’re in the early stages of conducting our own in-house research and would like to share an overview of some of the most impactful AI tools currently available:

Fireflies.ai: Streamlining Meeting Transcriptions and Analysis

Fireflies.ai automates the transcription and analysis of meetings, saving valuable time and ensuring accurate documentation. It supports platforms like Zoom, Google Meet, and Microsoft Teams, generating summaries, capturing action items, and enhancing team collaboration.

Key Features:

  • Automated transcriptions with multilingual support
  • AI-generated summaries highlighting key decisions and tasks
  • Task tracking integration with tools like Slack
  • A searchable database for easy retrieval of meeting notes
  • Analytics on meeting participation and talk time

There’s a free 7-day Business Plan trial available, but we’ve been using their free forever subscription over the past week and can confirm it’s very user-friendly. Give it a try here: Fireflies.ai

Saturn: A Customisable Platform for Financial Advisers

Saturn is a powerful platform designed to enhance the efficiency of financial Advisers, paraplanners, and compliance teams. It automates routine tasks, manages data, and ensures compliance, allowing professionals to focus more on client-facing activities.

Key Features:

  • Client management, data capture, and reporting
  • Compliance and risk management tools
  • Workflow automation to improve client service
  • High security standards to protect sensitive information

Find out more at: Saturn

Aveni: AI-Driven Automation for Administrative Tasks

Aveni specialises in automating administrative tasks in financial services. By leveraging voice AI, the platform enhances customer service, ensures compliance, and boosts overall productivity by automating client-related activities such as onboarding and document processing.

Key Features:

  • Automates tasks like client onboarding and document management
  • Voice AI to improve customer interactions
  • Ensures regulatory compliance
  • Provides performance coaching and quality assurance

Pricing: For a customised quote, please reach out directly to Aveni.

Avenir: Personalised Suitability Reports in Minutes

Avenir simplifies the process of generating personalised suitability reports. Designed for financial advisers, the tool integrates seamlessly with client records to create reports in under 25 minutes, saving time and ensuring accuracy.

Key Features:

  • Rapid generation of suitability reports
  • Customisable templates for tailored reports
  • Secure data processing and integration with client records

Pricing:

  • Standard Plan: Unlimited reports with Avenir’s templates (currently 3 available, with 2 more in the pipeline)
  • Premium Plan: Custom templates for your firm’s specific needs

The Importance of AI in Financial Services

AI is rapidly becoming a cornerstone of operational efficiency in the financial services sector. These technologies provide several key benefits:

  • Improved Efficiency: Automating repetitive tasks allows financial professionals to focus on higher-value activities like client engagement and strategic planning.
  • Enhanced Accuracy: AI ensures precise documentation, reducing the risk of human error.
  • Compliance and Risk Management: AI tools help businesses stay ahead of evolving regulatory requirements, reducing the likelihood of compliance issues.
  • Better Client Experience: Automation frees up professionals’ time, enabling them to deliver superior service to clients.

As AI continues to evolve, its impact on financial services will only expand. Firms embracing these technologies are well-positioned to improve operations, reduce costs, and deliver greater value to their clients.

We hope this edition of Tech Talk has provided valuable insights into the AI tools shaping the future of financial services. We will continue testing these systems over the coming months to assess which ones are truly worth the investment, and we’ll be sure to keep you updated on our findings.

Welcome to our monthly newsletter, Regulation Round Up. Each month, we’ll bring you key insights and timely updates on financial services regulations to help you stay informed and ahead of industry changes. Each month, we will cover key stories from HMRC and the FCA, along with other updates related to financial services rules and regulations.

FCA Advice Guidance Boundary Review

The FCA has released an update on its Advice Guidance Boundary Review, highlighting upcoming consultations that aim to make financial advice more accessible and affordable for consumers. For context, in late 2023, the FCA published policy paper DP23/5, “Advice Guidance Boundary Review – Proposals for Closing the Advice Gap”. This paper included three proposals to address the advice gap:

  • Targeted support
  • Simplified advice
  • Further clarification of the advice boundary

The review aims to ensure people have access to timely and affordable assistance when making important financial decisions to maximize their resources.

As of December 2024, the FCA has moved on to its first consultation, focusing on pensions. This consultation will explore how targeted support might work, including research into consumer interest. By mid-2025, the FCA plans to develop targeted support proposals and consult on draft rules that will apply to consumer investment and pensions.

Read more here:

FCA Seeks Further Views on Enforcement Transparency Proposals

The FCA has published the second phase of its consultation on increasing transparency in enforcement investigations and has outlined plans for further engagement following concerns raised in the original consultation.

New data from the regulator shows an accelerating pace of investigations, with some completing within 16 months. By providing data, case studies, and details on the public interest test, the FCA aims to clarify how decisions on announcing investigations might be made if the proposed changes proceed.

Read more here:

Government’s Pension Review Suspended

Reports indicate that the government’s retirement adequacy review has been postponed due to concerns about its impact on employers, particularly around potential increases in administrative burdens and contribution costs tied to proposed changes in auto-enrolment. especially after the recent budget. Key areas expected to be addressed in the review included:

  • Lowering the minimum auto-enrolment age from 22 to 18
  • Removing the £6,240 annual salary threshold so pension contributions apply from the first pound earned
  • Increasing minimum contributions from 8% to 12% of earnings

Read more here:

Pension Schemes Newsletter 165

HMRC has published Pension Schemes Newsletter 165, an important update for pension administrators and financial professionals. It provides guidance on recent changes to lump sum payment rules and offers clarity on regulatory requirements following the LTA abolition. Key highlights include:

  • Some members are asking how they can return pension commencement lump sums (PCLS) or uncrystallised funds pension lump sums (UFPLS) taken due to speculation about potential pension changes in the 2024 Autumn Budget. The newsletter confirms that tax-free lump sum payments cannot be undone, and lump sum allowances will not be restored.
  • Regulation 17(5)(2) clarifies that when a TTFAC is issued or cancelled, members must send a copy of the certificate to other schemes they belong to within 90 days or before any relevant benefit crystallisation event (RBCE). The 90-day period began on November 18, 2024, when the regulations came into force.

Read more here:

As a financial adviser, keeping up with regulatory changes is key to delivering the best advice to your clients. At We Complement, we’re here to help you navigate these shifts with confidence.

Get in touch today to see how we can support your practice and help you adapt to the latest developments in the industry.

 

As we welcome 2025, it’s the ideal time to reflect on the year behind us and prepare for the opportunities and challenges ahead. To help you start the year strong, we’ve curated insights and forecasts that highlight the key trends shaping the financial and professional services industries. Here’s what we anticipate will define 2025 and how you can stay ahead of the curve.

Business Growth and Innovation in 2025

In an evolving market, the ability to adapt and innovate remains essential for growth. Whether it’s through operational efficiencies, client-focused initiatives, or tailored investment strategies, this year presents an opportunity to enhance your service offerings.

We’ve identified resources that can assist with:

· Streamlining processes to optimise your time and resources.

· Responding to shifting investor priorities with targeted solutions.

· Navigating regulatory updates to ensure compliance while maintaining client trust.

Resilience in Action: Lessons from 2024’s Top Advisers

Financial advisers across the UK proved their mettle last year, despite the regulatory shifts and political headwinds. Success stories underline the importance of staying proactive amid regulatory and economic shifts.

Here’s what helped advisers thrive in 2024:

· A surge in demand for guidance as clients prepared for major changes, such as the elimination of the lifetime allowance and VAT-driven adjustments to private school fees.

· A robust influx of new business, emphasising the ongoing demand for professional financial guidance.

Key Legal and Regulatory Themes to Watch

With new rules and reforms coming into play, 2025 will be a pivotal year for financial advisers. A few standout developments:

· M&G vs. Royal London: The ongoing legal case highlights the importance of thorough due diligence, especially around investment products on adviser platforms. Staying ahead of compliance expectations will be key.

· Inheritance Tax and Pension Reforms: Proposed changes to IHT and pension rules are raising big questions for advisers. Clients will need your expertise to adapt their estate and investment plans while minimising disruption.

Big Changes in the Pensions World

Pensions are set to dominate the conversation this year, with several major initiatives you’ll want to keep an eye on:

· Pension Dashboards: 2025 marks a critical step toward better transparency. Soon, clients will be able to view all their pension information in one secure place—making your guidance more important than ever.

· Defined Contribution Reforms: Updates are expected around value-for-money frameworks and small pot consolidations will reshape the DC landscape, requiring a recalibration of client strategies.

· Pension Mega Funds: The consolidation of council pension schemes into larger funds could unlock significant investment potential, creating opportunities for advisers to support.

Positioning for Success in 2025

This year is poised to be transformative for financial advisers. Staying informed and prepared for industry shifts will be crucial to achieving success, both for your practice and your clients. By aligning your strategies with emerging trends and leveraging expert insights, you can confidently address the complexities of 2025.

At We Complement, we’re committed to supporting financial advisers with the resources and tools needed to thrive in a dynamic market. Let’s make this year a milestone in professional growth and client satisfaction.

What priorities will shape your approach in 2025? Share your thoughts or reach out to us to discuss how we can support your goals.

 

As we approach the end of 2024, it’s crucial for financial advisers to reflect on the key events that have shaped the investment landscape this year and start considering what 2025 might hold for clients. Here’s a look at some of the most important developments.

How the Bull Market Held Strong in 2024

Despite the turbulence of 2024—including geopolitical tensions, trade disruptions, and unexpected political shifts like Donald Trump’s return to the White House—the equity markets showed remarkable resilience. As financial advisers, it’s clear that while many had expected increased volatility, investors instead focused on long-term growth opportunities, keeping the bull market strong. The lesson here? Market resilience is more robust than we often anticipate, and there are always opportunities to capitalise on.

What’s on the Horizon for 2025?

Looking ahead, there are several key trends financial advisers should keep in mind as they guide their clients through the next year:

Global Growth with Regional Differences: The global economy is expected to grow, although with some regional slowdowns—particularly in China. This growth will likely create significant disparities across sectors, regions, and investment styles. For your clients, this could mean opportunities for diversification and carefully considered investments in emerging areas.

Higher Interest Rates for Longer: With central banks maintaining elevated interest rates, especially in developed markets, it’s critical to adjust portfolios for a more challenging environment. Active management and thoughtful asset allocation will be essential to navigating these higher-rate periods successfully.

International Opportunities: As valuations in international markets become increasingly attractive, financial advisers should look beyond domestic markets to identify undervalued opportunities that may be poised for growth. There are risks, but with careful analysis, these could translate into strong returns for well-informed clients.

Looking Back to Look Ahead

2024 has demonstrated that markets are capable of staying resilient, even amid uncertain times. As we approach 2025, it’s clear that the year ahead holds both challenges and opportunities for financial advisers and their clients. Staying informed and adaptable will be key in navigating the evolving financial landscape.

At We Complement, we specialise in helping financial advisers stay ahead of market trends, offering tailored investment strategies, expert insights, and the support you need to make informed decisions for your clients. We are here to help you navigate the complexities of the investment world, so you can deliver exceptional value to your clients in 2025 and beyond.

Let’s work together to make 2025 a year of smart, strategic investment planning for your clients! Reach out to We Complement today to find out how we can support you.

 

Welcome to this month’s Esoteric Products newsletter. December is proving to be an eventful time for financial and investment markets, with a host of new developments that could significantly affect wealth management strategies. From inheritance tax (IHT) implications to the evolving dynamics of venture capital and crypto, here are some of the most noteworthy updates.

UK’s Wealthiest Face Record IHT Bills Amid Policy Shifts

Recent changes in the UK Budget have brought inheritance tax (IHT) into sharper focus, with estimates suggesting that the country’s wealthiest could face bills exceeding £9 million. These changes primarily affect pension savers and farmers, among others, by tightening reliefs and exemptions. For those navigating estate planning, it is critical to evaluate strategies that reduce IHT exposure, particularly as we approach the implementation of new rules in April 2027. Read more here.

The latest adjustments highlight the importance of long-term planning. Tools like trusts, life insurance options, and charitable giving can help lessen tax liabilities. As we’ll explore below, new products and strategies are emerging to address these challenges.

Royal London’s Second Life Cover: A New IHT Planning Tool

Royal London has introduced a second life insurance option aimed at helping families tackle inheritance tax obligations. This innovative solution ensures a payout occurs only after the second policyholder’s death, offering a cost-effective way to manage substantial IHT liabilities. Explore more details here.

This product reflects a broader trend towards personalised financial solutions that cater to complex family dynamics and significant estates. Financial advisers should consider this as a key recommendation for clients with large assets who wish to protect their wealth for future generations.

Venture Capital Trusts: Unlocking Portfolio Potential

Venture Capital Trusts (VCTs) continue to stand out as a dynamic investment vehicle, offering significant tax benefits and the potential for high returns. Recent analysis highlights their growing appeal, particularly as traditional investment avenues face increased scrutiny. Learn more about VCTs here.

By investing in smaller, high-growth companies, VCTs allow investors to diversify portfolios while benefiting from tax reliefs. However, these vehicles are not without risks, including the inherent volatility of early-stage companies. For experienced investors looking to complement their portfolios, VCTs represent a compelling, albeit specialised, opportunity.

The Role of Active ETFs in Modern Portfolios

Active Exchange-Traded Funds (ETFs) are gaining traction, blending the low-cost benefits of traditional ETFs with active fund management’s potential for outperformance. Unlike passive ETFs, which track indices, active ETFs enable fund managers to pivot based on market conditions and emerging opportunities. Discover how active ETFs work.

Recent developments, such as Pictet Wealth Management’s decision to shift ETF coverage to active fund analysts, illustrate the growing interest in this space. As the investment landscape becomes increasingly complex, active ETFs offer a flexible and strategic approach for those seeking both growth and stability.

Budget Impacts on AIM Shares: What Investors Should Know

The UK Budget has also introduced changes affecting AIM (Alternative Investment Market) shares, a popular option for growth-focused investors. While AIM shares offer certain IHT reliefs and opportunities for high returns, the recent policy adjustments may alter their attractiveness. Read the full analysis here.

Investors should review their exposure to AIM shares, balancing the potential for tax-efficient growth against the risks associated with smaller, less liquid companies. Diversification and a clear understanding of the new rules will be critical for maintaining robust portfolios.

Gold ETF Flows: November 2024 Trends

Gold continues to shine as a haven amid market volatility, with November data revealing net inflows into gold ETFs. This trend reflects investors’ growing preference for stable assets during uncertain times, particularly as central banks adjust monetary policies globally. Check out the latest gold ETF data.

Gold ETFs offer an accessible way to gain exposure to this precious metal without the challenges of physical ownership. For those seeking to hedge against inflation or diversify their portfolios, gold remains an essential component.

Deregulation and Crypto: Big Changes at the SEC

The cryptocurrency landscape is poised for transformation as the US Securities and Exchange Commission (SEC) embraces deregulation and innovation. These changes aim to foster growth within the crypto industry, signalling a shift in how digital assets are governed. Find out what’s changing at the SEC.

For investors, this opens up new opportunities but also demands vigilance. The regulatory environment will play a crucial role in shaping the future of crypto investments, making it essential to stay informed and adaptable.

The Case for CLO Equity in Diversified Portfolios

Collateralised Loan Obligation (CLO) equity is gaining attention as a valuable complement to private equity investments. Offering attractive yields and a different risk profile, CLO equity provides a unique avenue for diversification. Learn more about the benefits of CLO equity.

This asset class is particularly appealing to experienced investors seeking to balance the high growth potential of private equity with the steady income streams associated with debt instruments. As with any complex investment, professional advice is recommended to navigate this space effectively.

As 2024 draws to a close, the financial landscape is marked by rapid changes and emerging opportunities. Whether it’s adapting to new IHT rules, exploring innovative investment vehicles like active ETFs and VCTs, or staying ahead of shifts in the crypto market, now is the time to reassess strategies and align portfolios with future goals.

We encourage our readers to reach out for personalised guidance tailored to their clients unique financial circumstances. Here’s to navigating 2025 with clarity, confidence, and success!

 

Welcome to this month’s edition of the Tech Talk Newsletter! As always, we’re keeping you updated on the latest tools, insights, and news to help you stay ahead. December might be a quieter month for some, but our industry is buzzing with updates, especially around Consumer Duty and new innovations in financial advice technology. Let’s go!

New Diagnostic Tool to Tackle Consumer Duty in 2025

If you’ve been keeping an eye on the Financial Conduct Authority’s (FCA) Consumer Duty regulations, you’ll know the landscape is set to shift again in 2025. To help firms get ahead, the Consumer Duty Alliance (CDA) has partnered with The Consumer Duty Diagnostic to launch a new diagnostic tool.

This isn’t just another compliance checklist—it’s a dynamic tool designed to help firms benchmark their progress across critical areas of Consumer Duty, like cultural transformation, outcome testing, and client advocacy.

Keith Richards, CDA’s CEO, explained the reasoning behind this launch:

“The FCA is increasingly using data requests to evidence compliance with the duty and has signaled plans for random spot audits during 2025.”

The tool includes ten subject areas and 50 diagnostic questions. Answering these provides firms with a personalised report, offering actionable recommendations to plug any gaps, meet regulatory standards, and even identify potential growth opportunities.

The focus here isn’t just compliance—it’s outcomes. Richards made a great point about how the shift from prescriptive tick-box exercises to outcomes-driven assessments is already proving beneficial:

“Good consumer outcomes are leading to good business outcomes across the sector.”

But it’s not all smooth sailing. With a record number of Section 166 notices issued this year, firms are under pressure to tighten their practices. The CDA tool is a smart way to ensure you’re ready for whatever the FCA throws your way.

Consumer Duty Diagnostic

Making Financial Advice Accessible with LifeStage

Let’s switch gears to something super practical. WPS Advisory Limited, in partnership with Moneyhub , has launched a new app called LifeStage —and it’s a game-changer.

LifeStage was created to make financial advice more accessible and affordable. It’s designed to help users get a clear picture of their finances, from income and spending to savings, debts, pensions, and property. All of this is presented in one user-friendly dashboard, giving people the tools they need to make informed decisions.

Natalie Oliver, Head of Strategy at WPS Advisory, summed up the app’s mission perfectly:

“Our aim is to empower customers to manage their finances today, tomorrow, and in the future, while maintaining exceptional value for money.”

The app integrates with tools like:

  • Guiide: A pension modeling tool that helps users create and manage retirement plans.
  • SmartSearch: For instant anti-money laundering checks, ensuring compliance with regulations.

One feature I love is the data-sharing capability through Moneyhub’s sharing centre. Users can share their financial data with advisers, ensuring their advice is always based on real-time, accurate information. It’s a win-win—clients get tailored advice, and advisers get a clearer picture of their client’s financial situation.

Dan Scholey, Chief Commercial Officer at Moneyhub, described the app as a response to growing demand for workplace financial advice, especially in light of the FCA’s advice guidance boundary review. He also highlighted a key insight:

“Poor employee financial health impacts mental health, productivity, and retention. Employers have a big role to play in supporting their workforce’s financial well-being.”

The Problem with Platform Service: Parmenion’s Report

Now onto an issue that’s causing headaches across the industry—poor platform service.

Parmenion ’s latest report, The Impact of Poor Platform Service, created with the the lang cat, revealed some staggering statistics. Did you know that 95% of advisershave had to apologise to their clients because of poor platform service this year? That’s up from 2023 and a clear sign that something needs to change.

One adviser quoted in the report called the service they’ve experienced “unbearable,” citing long delays, lost records, and a lack of knowledgeable support. It’s no wonder 45% of advisersswitched platforms in 2024 due to frustration.

Platform transfers are a particular pain point:

  • 90% of advisers associate transfers with negative experiences.
  • Over 20% reported delays exceeding six months.
  • Nearly 10% have waited more than a year for a transfer to complete.

These delays and inefficiencies are more than just an annoyance—they’re impacting productivity and eroding trust. Martin Jennings, Parmenion’s CEO, didn’t hold back in his assessment:

“In the new era of Consumer Duty, this year’s report is a disappointing read. Poor platform service is linked to a double-digit loss of productivity in advice firms.”

One proposed solution is for providers to publish standardised transfer data to improve transparency and accountability—something 89% of advisers support. Meanwhile, 75% of firms now favour cash transfers for their predictability and speed.

Steven Nelson, Insight Director at the lang cat, put it bluntly:

“Platforms must embrace technology and improve their processes—or advisers will vote with their feet, as we’ve already seen this year.”

As we wrap up 2024, it’s clear the industry is facing a mix of challenges and opportunities. From the evolving Consumer Duty landscape to the rise of tech-driven financial advice, the key takeaway is this: staying ahead means embracing innovation and focusing on outcomes.

At We Complement, we’re passionate about keeping you informed and equipped to handle whatever comes your way. If you’d like to learn more about any of the tools or reports mentioned, or if there’s something specific you’d like us to cover next month, let us know—we’d love to hear from you!

Wishing you all a productive and peaceful end to the year.

 

The regulatory landscape never stays still, and this month has been no exception. From shaping the future of customer redress to addressing financial crime and improving operational resilience, the FCA has been busy setting clear expectations for firms. These updates are a reminder of the ever-growing importance of staying ahead in compliance while also delivering the best outcomes for customers.

Here’s a quick breakdown of this week’s most significant developments and how they might impact your business.

Have Your Say: Modernising the Customer Redress System

The FCA wants your input on how to improve the way the Financial Ombudsman Service handles complaints—especially mass complaints. They’re looking at how the system could be made more efficient, effective, and fit for the future.

This is a great opportunity to share your thoughts and help shape the way complaints are managed going forward.

👉 Find out more and share your views.

 

Bereavement Handling: FCA Pushes for Better Practices

Losing a loved one is hard enough, and the FCA has called on firms to step up their game when it comes to supporting bereaved customers. They’ve shared examples of best practices and reminded firms to handle these situations with care, empathy, and efficiency.

It’s a good moment for everyone to reflect on how their processes measure up and make improvements where needed.

👉 Check out the FCA’s recommendations.

 

Metro Bank Fined £16M for Financial Crime Failings

Metro Bank is facing a £16 million fine from the FCA for serious shortcomings in its financial crime controls. The regulator flagged issues with how the bank assessed risks and monitored transactions, which fell short of the standards expected.

This serves as a strong reminder to all firms to keep their financial crime prevention measures sharp and up to date.

👉 Read more about the fine and what it means.

 

FCA Emphasises Operational Resilience

The FCA is urging firms to bolster their operational resilience, with a regulatory deadline of March 2025 to ensure compliance. This includes identifying critical services, setting impact tolerances for disruptions, and testing systems to prepare for events like cyberattacks or system outages.

Recent incidents, such as the CrowdStrike outage in July 2024, have highlighted vulnerabilities in financial infrastructure, emphasising the need for proactive resilience planning. Firms must act now to address gaps, ensure robust recovery measures, and meet the FCA’s expectations for safeguarding consumers and market integrity.

👉 Learn more about operational resilience requirements here.

 

Need Support Staying on Top of Regulatory Change?

Keeping up with the latest regulatory developments can be a challenge, but you don’t have to do it alone. Our Adviser Support Services can help lighten the load. Whether you need support with investment research, paraplanning, or just want a partner to help you stay ahead, we’re here to help.

Get in touch today to learn how we can make your life easier.

Have a great weekend!

 

Contact

Old Brewery Business Centre
Castle Eden
Co. Durham
TS27 4SU

Tel: +44 (0)1472 728 030
Email: hello@wecomplement.co.uk

© 2025 We Complement | Privacy Policy
We Complement Limited registered in England & Wales under company number 13689379, ICO number ZB427271. Registered address: Old Brewery Business Centre, Castle Eden, Co. Durham, TS27 4SU.