Targeted Advice Explained: A Major UK Financial Advice Change from 2026

What Is Targeted Advice and Why It Matters from April 2026

In April 2026, a major change in how financial support is offered to UK savers and investors is due to take effect: the Financial Conduct Authority (FCA) and government are introducing a new regulatory regime known as Targeted Support (sometimes called “targeted advice”). This marks the biggest reform of the financial advice and guidance landscape in over a decade, and it’s intended to help millions of people make smarter decisions about savings, pensions and investments.

Why Targeted Advice is Being Introduced in the UK

The background to this initiative lies in the so-called “advice gap”, the large number of consumers who either cannot afford personalised financial advice or simply don’t seek it. Currently, only a small minority of UK adults receive regulated financial advice, leaving many people making complex financial decisions on their own.

Policymakers and the FCA believe that this gap has contributed to under-investment in the wider UK population. Many people hold significant amounts of cash, do not diversify into investments, and don’t plan effectively for retirement. By loosening strict regulatory barriers that have historically made advice expensive and time-consuming to deliver, targeted support seeks to help people who fall between basic guidance and full personalised advice.

The government and FCA have designed the regime so that firms can make ready-made financial suggestions to groups of consumers with similar financial needs or characteristics without conducting a full individual assessment. This support will sit between general guidance and regulated personalised advice.

What Targeted Advice Will Look Like in Practice from April 2026

How Firms Will Identify Consumer Groups

Under the new regime, firms can identify groups of consumers, sometimes called consumer segments, who share financial characteristics, for example, people with large cash savings or those approaching retirement.

What Types of Recommendations Firms Can Make

Firms can then make recommendations or “ready-made suggestions” tailored to that group, without doing a full fact-find and suitability assessment for everyone.

This means, for example, that a provider may be able to suggest strategies for someone with substantial cash holdings that are not earning much interest, or highlight better pension drawdown strategies for people nearing retirement without triggering full financial advice rules.

A provider may be able to suggest strategies for someone with substantial cash holdings that are not earning much interest, or highlight better pension drawdown strategies for people nearing retirement without triggering full financial advice rules

FCA Rules and Authorisation Requirements

Importantly, the FCA must still authorise firms to provide this service.

Targeted support does not replace full regulated advice; it is intended to sit between guidance and personalised advice.

The FCA’s new framework and rules, set out over dozens of pages in the Handbook, will apply from 6 April 2026, with firms able to begin applying for permission as early as March 2026.

Benefits of Targeted Advice

1. Improved Access to Financial Support

A fundamental goal of the regime is to help people who are currently underserved by traditional advice services. Many consumers with modest savings or no adviser find financial decisions intimidating or confusing. Targeted support could provide meaningful help without high cost.

This has the potential to reach millions of people, with some estimates suggesting that up to 18 million UK adults could benefit in the coming decade.

2. Better Financial Decision-Making

By allowing firms to signal useful strategies, such as whether to invest cash savings, how to improve pension outcomes, or how to avoid unsustainable pension drawdowns, targeted support could help consumers make much better long-term financial decisions.

3. Lower Costs Compared to Full Financial Advice

Traditional regulated advice can be costly and requires a detailed fact-find and suitability report for everyone. Targeted support cuts through much of this complexity, meaning firms can help consumers without the full weight of the current advice regulatory regime.

For consumers who don’t currently seek professional advice due to cost, this could be a significant step forward.

4. Potential to Close the UK Financial Advice Gap

Policymakers see targeted support as a tool that could increase retail participation in investment markets and boost financial resilience. Given the relatively low proportion of UK household financial assets held in shares and bonds compared with other countries, this could help shift outcomes over the long term.

Potential Pitfalls and Risks of Targeted Financial Advice

While the initiative has wide support, it is not without potential challenges.

1. Risk of Misleading or Inappropriate Financial Suggestions

Because targeted support does not involve a full individual assessment, there is a risk that a suggested “ready-made” action might not suit everyone in the group. Firms are expected to have reasonable grounds to believe the support will benefit consumers, but individual circumstances can vary widely.

2. Commercial Bias and Conflicts of Interest

Some commentators worry that firms might use the regime to promote their own products under the guise of assistance, especially if the regulatory safeguards are not robust or if consumers assume suggestions equate to personalised advice.

Putting commercial interests ahead of consumer outcomes would undermine the regime’s purpose, so the FCA expects strict governance, monitoring, and Consumer Duty compliance

Putting commercial interests ahead of consumer outcomes would undermine the regime’s purpose, so the FCA expects strict governance, monitoring, and Consumer Duty compliance.

3. Confusion Between Guidance and Regulated Advice

The advice guidance boundary is already complex. Targeted support adds another layer, and consumers may find it hard to understand when they are receiving:

• information
• targeted support
• or regulated financial advice

Clarity in communication will be essential to avoid misunderstandings or misplaced expectations.

4. Not All Firms Will Be Ready

Not all firms will be ready or able to offer targeted support effectively. Some smaller firms may struggle with the compliance, governance and infrastructure needed to deliver good outcomes, and the FCA is still consulting on certain operational details.

5. Why Targeted Advice Is Not a Replacement for Personal Advice

For consumers with complex personal circumstances, such as significant pension pots, cross-border tax issues, or complicated estate planning needs, targeted support will still fall short of what a bespoke adviser provides. It’s a bridge, not a replacement.

What Targeted Advice Means for Consumers from April 2026

From April 2026:

• Financial firms may offer suggestions and tailored pathways to help you invest, manage pensions, or otherwise improve financial outcomes without full suitability assessments.
• This could be free or low-cost in many cases and more accessible than traditional advice.
• However, consumers must understand the difference between targeted support and individual regulated advice and carefully evaluate any suggestions before acting.

For many people, this new framework could be a valuable step toward better financial decision-making, but understanding its boundaries and limitations will be crucial.

Final Thoughts on Targeted Advice and the April 2026 FCA Changes

Targeted support represents one of the most significant reforms in UK financial services in years. Designed to bridge the advice gap and encourage wider participation in investment and pension planning, it has the potential to help millions make better financial decisions.

However, it is not a substitute for personalised advice and comes with risks that both consumers and firms will need to manage carefully.

As this regime rolls out in April 2026, understanding how it works and where it fits in relation to traditional advice will be key to making it work for you.