You will be acutely aware that the financial services industry is facing some of the most profound changes it has ever seen as a result of the FSA’s Retail Distribution Review (RDR). 

Of particular relevance to advisers is how firms describe the type of advice they give to their clients. As you will know, one choice you will have to make is whether to offer ‘independent’ or ‘restricted’ advice from the end of 2012.

The FSA’s aim is to improve clarity for customers about the different types of advice on offer. Which type of advice you will be providing will need to be disclosed to clients at the start of the advice process. At the same time as this change, the FSA is setting a new standard for independent advice which, for example, means that a broader range of products needs to be considered by advisers when making recommendations.

Retaining the ‘independent’ tag is understandably seen as important by many advisers. To others, restricted advice has its attractions due to practical considerations. However, it isn’t an easy decision to make and the continuing confusion around what is expected of a firm offering independent advice hasn’t helped. However, the FSA recently issued some formal guidance on this matter which answers many of the questions posed by advisers.

In the following pages, we outline some of the considerations you will need to bear in mind when making your decision on which route to take. We hope you find this useful. 

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