A large majority of financial advisors – 85 per cent – are actively increasing the percentage of income they get via fees, according to a survey by Skandia of 1,300 advisors.

Once the Retail Distribution Review - the UK programme of regulatory change to financial advice - kicks in, 72 per cent of those polled said 70 per cent of their customers will prefer to pay for these fees by having money deducted from their products rather than paying directly.

Nevertheless currently, a huge majority – 91 per cent, still depend on commission as a source of income whilst 49 per cent say they are still receiving at least 50 per cent of their income through commission.

Half of advisors claim they were looking to increase the fee-based income before the RDR was announced whilst 35 per cent are following this route because of the RDR.

"With the Retail Distribution Review looming, the face of financial advice and how customers pay for advice is evolving rapidly. Our research confirms, the majority of advisors are currently heavily reliant on commission but we are seeing a considerable shift towards fees,” said Jeremy Mugridge, a platform specialist at Skandia.

The shift towards a fee-based model of advice is intended to avoid a conflict of interest for the advisor, hence reducing product pushing towards clients and aiming to encourage independence of advice. In another advisor survey, by Defaqto earlier this month, 55 per cent of advisors said they would move to a fee-based model.

Skandia UK’s funds under management stood at £31.9 billion on 30 September 2010.