UK wealth manager Rathbones released new research last week by Pure Profile looking at the rise in personal wealth managed by UK financial advisors.

More people are managing their personal wealth through active, bespoke investment management services offered by financial advisors – a trend which is expected to grow over the next two years, according to new research from Rathbones, a UK wealth and asset management firm. 

The finding appears to reflect the efforts of increasing numbers of people across an ageing UK population to save for later life, many of whom have real and mounting concern that they may not have enough resources or make the right decisions to live well in retirement, the firm said in a statement. 

The study suggests that more money is being invested in the UK and by relatively affluent people, since 46 per cent of advisors ask for a minimum portfolio of £400,000 ($542,000) to qualify for bespoke services. Moreover, 93 per cent of wealth managers and financial advisors who offer an investment management service typically use it to manage no more than a quarter of a client’s wealth, the survey reveals. 

All advisors contacted said the percentage of clients’ assets which they manage through a bespoke investment management service has increased since 2023, with 77 per cent reporting an increase of up to 25 per cent. Those advisors who don’t currently recommend bespoke investment management services expect to do so in the next four years.

Rathbones commissioned independent research agency Pure Profile to interview 100 UK IFAs and financial planners including 75 who currently offer bespoke investment management/discretionary fund management services.

“Bespoke investment management services offer financial advisors and wealth managers access to research capabilities and an ability to react quickly to changing market conditions and individual client needs, making them increasingly popular,” Simon Taylor, head of strategic partnerships at Rathbones, said. “With an ageing population in the UK, and people increasingly aware of the need to provide for their retirement, we’re seeing growing demand for such advice and support.” 

This growth trajectory over the last two years is only set to continue with all advisors surveyed saying that they predict a further increase in the percentage of clients’ assets managed through a bespoke investment management service between now and 2027. One in five expect an increase of between 5 per cent and 15 per cent of clients’ assets managed through a bespoke investment management service over the next two years. Sixty-four per cent expect an increase of between 15 per cent and 25 per cent and around one in eight advisors expect an increase of between 25 per cent and 50 per cent.

Whilst nearly half of advisors say clients need a portfolio of at least £400,000 to qualify for bespoke services, around one in 10 say they would offer a bespoke investment management service to clients with between £250,000 and £300,000 in their investment portfolio.

All advisors said clients will need to have a bigger investment portfolio in the future to be considered for a bespoke service. Almost three in 10 advisors said clients’ investment portfolios will need to increase by up to 15 per cent to be considered in the next two years, whilst 52 per cent said they would need to increase by between 15 per cent and 25 per cent, the survey shows.  

“Bespoke investment management was historically better suited to people with larger sums to invest because that invariably came with more complex tax circumstances," Taylor continued. "However, advisors and wealth managers are increasingly focused on personalised and changing income profiles for people across their whole period of retirement. This requires a more dynamic approach to structuring investment portfolios and, as part of this response, we are broadening our offerings to support both individuals and their financial advisors."