20% of IFA firms can not estimate the financial impact of Retail Distribution Review (RDR) transition upon their businesses, according to research conducted by NMG on behalf of the Association of Independent Financial Advisers (AIFA)
Carried out among the owners of 140 IFA firms, the research has highlighted uncertainty over the costs facing IFA firms as a result of the RDR consultation paper. When asked the cost per adviser of a successful business transition programme, a fifth of owners could not estimate the financial impact on their firms. The estimates that were given varied wildly: 9% believed there would be no cost to the business compared to 10% who believed the costs would be over £10,000 per registered individual.
However, nearly half of IFA firms are currently investing between one and five hours each week into their transition 18% are investing between six and 10 hours and 6% are investing over 10 hours. However, the task is not going to be a quick one with over half believing that their firms won’t be RDR ready until the end of 2012 and, worryingly, 10% saying that transition won’t be complete until beyond 2012
Chris Cummings , director general of AIFA, said: “I am both concerned and encouraged by the research results. My concerns stem from the financial uncertainty that the RDR is creating in IFA firms