The second quarter had no shortage of reasons for advisers and their clients to sit on their hands: the tax year turning over, pensions being pulled into the inheritance tax net, and a change of prime minister after Keir Starmer’s resignation on 22 June handed Number 10 to Andy Burnham. None of it stopped the money moving. UK investment distribution assets rose 12% to £1.2trn, though that lagged the FTSE All World’s 14% gain over the same period, so markets did more of the work than net new money this quarter.
Let it flow
The flow numbers are where the quarter earns its stripes. Gross flows hit £102bn, a new quarterly high and the first time the industry has broken through £100bn. Net flows landed just short of £6bn once withdrawals were accounted for, a sharp turnaround from Q1’s outflows of £372m and up 12% on the same quarter last year. Much of that activity has an obvious driver: with the Cash ISA allowance due to be cut to £12,000 for under-65s in April 2027 and pensions now in the IHT conversation, advisers spent the quarter getting ahead of both.
Advice firms dominated the field capturing £91.5bn of gross flows and £4.8bn of net. Perspective, Partners Wealth Management, Succession Wealth, Fairstone and 2plan led the rankings. The MPS rankings told a similar story, with Perspective’s Cambridge MPS arm topping the table ahead of LGT, Tatton and RBC Brewin Dolphin.
Q3 and beyond
Burnham’s first weeks in Downing Street land right at the start of the third quarter, and a new prime minister still enjoying the benefit of the doubt could bring a feelgood factor that nudges sentiment up further… if his first hundred days go down as well with the public as they have with his own party. Whether Q3 brings a real lift in sentiment or simply calmer headlines, tax efficiency is the theme advisers will be building around either way.