Outflows from advised platforms hit a record high of £14bn, a 12% increase from the previous quarter, data from the lang cat has revealed.
Total outflows from advised platforms this year-to-date sits at £38.1bn, a 30% increase compared to the same period last year.
Record high outflows combined with record low net sales of £1.7bn has resulted in hardly any asset growth for advised platforms, according to the lang cat.
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The data showed that assets increased by just 0.06% from Q2 ending the quarter at £545.96bn.
Quilter maintained its lead with £69.65bn of assets under administration (AuA) followed by Abrdn with £68.46bn.
Rich Mayor, senior analyst at the lang cat, said: “Advisers are telling us there are two main drivers; clients are withdrawing more to cash savings and also to cope with the cost of living. The responses from advisers are consistent with the conversations we’re having with platforms too.
“Retirement plans and sums needed are likely to have increased due to inflation, cash interest rates are the highest they’ve been for years, as are annuity rates. All of this combines to create a perfect storm for advised platforms.”
Mayor believes that we have just about reached the peak of this activity.
He added: “The fourth quarter is likely to be similar to this one, but with interest rates steady, cash and annuities rates have likely hit a high point. It’s likely that 2024 will be the start of things turning back to something like normal for platforms. But the journey will be slow and recovery fragile.”