Millions of people continue to face complex financial decisions without the support they need. In response, the government and the Financial Conduct Authority (FCA) are proposing a new regulated activity: targeted support. Launched for consultation at the end of June 2025, with a further policy note and draft legislation published in July, this new model aims to bridge the gap between general guidance and full financial advice, especially around pensions and investments.
Targeted support would enable authorised firms to group individuals who share similar characteristics or financial situations and make structured recommendations designed for that group. These could include suggestions such as increasing pension contributions, selecting a drawdown strategy, or choosing a suitable investment product. Crucially, these recommendations would not count as “advising on investments” under Article 53 of the Regulated Activities Order (RAO). Instead, targeted support would be treated as a distinct regulated activity with its own set of conduct rules and disclosure requirements.
To qualify, the recommendation would need to be clearly designed for a group and not tailored to the individual. Firms must disclose that the suggestion is not based on a full individual assessment, and they must explain what group traits have informed the recommendation. The goal is to reach consumers who would otherwise receive no regulated advice: only 9% of adults received such advice in the year to May 2024, according to the Financial Lives Survey 2024.
The targeted support regime proposes several important changes:
Currently, Appointed Representatives (ARs) are not permitted to provide targeted support. ARs are firms or individuals who are allowed to carry out regulated financial activities on behalf of a fully authorised firm, without being directly authorised by the regulator themselves. Legislative change would be required to allow ARs, who operate under the oversight of an authorised principal, to deliver this form of guidance. This is under consideration.
Alongside targeted support, the FCA is also proposing reforms to its advice rules, particularly around simplified advice. These changes aim to give firms greater confidence to offer low-cost, focused advice to consumers with straightforward needs, helping build a continuum of support, from guidance to targeted support, to full advice.
Targeted support consultation closes on 29 August 2025, with final rules expected by the end of the year. Firms will be able to apply for permission in 2026, with implementation potentially beginning later that year or in early 2027. However, the 2027 timeline may be challenging. Our recent research into DC decumulation readiness shows that many providers are still waiting for full regulatory clarity before committing to specific models. Questions remain over how targeted support will interact with new default decumulation obligations under the Pension Schemes Bill, also due to take effect from 2027.
At Pi Partnership, we believe targeted support represents a balanced and much-needed innovation. It offers a scalable, accessible way to help consumers make better decisions, without the costs or complexity of full advice. Its success depends on regulatory clarity, firm readiness, and effective collaboration across the sector. If delivered well, targeted support could become a core component of modern pension and investment support.
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Amanda is a Board Director of Pi Partnership Group and leads the development of Pi’s services. She works closely with clients, the Pi team and professional advisers to ensure all of Pi’s services meet the changing needs of the pension market and deliver clear value to Pi’s clients.
Amanda has over twenty-five years’ experience in the pensions industry and, as well as ensuring Pi’s services continue to meet the needs of our clients in a rapidly changing pension landscape, is also a member of Pi’s Executive Management Team. She provides specialist project management for clients on a range of services, including adviser selection and review, trustee board assessment and governance design.
As well as being a Fellow of the Pensions Management Institute (PMI) and Chair of the PMI London Group, Amanda holds PMI certificates in Pensions Automatic Enrolment and DC Governance, was a past Prince2 practitioner and is a Certified Risk Management Practitioner.
What do you most enjoy about your role: Successfully delivering complex projects and creating a happy team environment.
Interests outside work: Travel, theatre and as part of Abundance London helping create beautiful spaces in urban settings.
Top achievement to date: Competing in the 2005/06 Round the World Clipper race.
