The number of Financial Planners is set to grow according to wealth consultancy NextWealth, after its research showed that Financial Planners are younger and more ambitious than typical financial advisers.

NextWealth's Financial Advice Business Benchmarks 2023 Report, published today, reveals clear distinction between average advisers and Financial Planners.

Of the finance professionals surveyed, 60% described themselves as advisers, with 31% describing themselves as Financial Planners.

The research revealed several striking differences between advisers and Planners.

Planners generally charge more: 70.2 bps compared to 60.1 bps for those who define themselves as advisers.

Planners also have clients with higher average client portfolios - £487,000 compared to £223,000 for advisers.

According to the survey, Planners want to work with more younger clients than advisers.

Asked if they are looking to attract younger clients, 29% of Planners said yes, compared to just 23% of advisers. 

Advisers are also twice as likely to want to sell their businesses than Financial Planners (18% advisers compared to 9% of Planners).

Planners also demonstrated ambition across the board:

• 58% plan to grow by increasing assets (compared to 38% of advisers).
• 59% plan to increase their number of clients (compared to 46% of advisers).
• 34% plan to increase staff (compared to 18% of advisers).
• 17% plan to grow by acquisition (compared to 9% of advisers).

Financial Planners were early adopters of cashflow modelling which remains one of the key distinguishing factors, according to NextWealth. Some 54% of planners used cashflow modelling compared to just 18% of advisers.

Client portal use is also higher among firms that use the term Financial Planner at 70% versus 43%.

Heather Hopkins, managing director at NextWealth, said: “Financial Planner is a comparatively recent term and therefore it’s unsurprising that those who use this term are likely to be younger, with a quarter being under 45. They are also three times more likely to work for firms with Chartered status and nearly a third of our Financial Planner respondents hold a Level 7 qualification.

“The NextWealth view is that we will see a growth in the use of the term in the future, as it becomes more accepted as a door-opener to younger clients.”

Sally Plant, CISI assistant director, Financial Planning and education development, said: "The fact that firms using the term “Planners” were found to be more positive about the future than those with advisers will be good news for Financial Planning clients.”

• The results in the Financial Advice Business Benchmarks 2023 Report were based on a survey of 244 financial advice professionals conducted between 11 July and 21 August.