As of 6 April 2026, the Financial Conduct Authority (“FCA”) has introduced its targeted support regime, a reform designed to help millions of people make better decisions about their pensions and investments.
Recent FCA research indicates that at present, only 9% of adults have received financial advice on their pensions or other investments within the past year. This reflects the FCA‑identified “advice gap”, whereby many savers lack access to simplified, targeted and affordable support to help them make informed decisions about their pensions and investments. The new targeted support framework is intended to fill this gap by allowing banks, pension providers, and other firms to provide more meaningful, tailored help to consumers who may otherwise not seek full financial advice.
What Is the Targeted Support Regime?
Targeted support creates a middle ground between general guidance and full financial advice. Under current FCA rules, banks and pension providers can only provide generic information or warnings and anything too specific could be deemed personal advice and trigger onerous regulatory requirements. Targeted support will enable authorised firms to provide financial support on the basis of limited information and without requiring a comprehensive assessment of the client’s individual circumstances, as would ordinarily be necessary for the provision of tailored financial advice.
Under the new regime, authorised firms will be required to identify defined consumer segments, comprising hypothetical consumers who share similar characteristics or circumstances. Firms may then develop ready‑made suggestions addressing common financial support needs or objectives, which can be provided to consumers within the applicable segment, but only where doing so would place the consumer in a better position than if no advice had been given.
Boundaries of Targeted Support
In consideration of the grey area in which targeted support operates - sitting between tailored financial advice and more general, widely available guidance - the regime specifies clear disclosures that authorised firms must provide to consumers to ensure their reliance on the support is appropriately understood. This involves clearly identifying the suggestion as targeted support, explaining the nature and limitations of the service, and confirming that the recommendation is not based on the client’s individual circumstances. Authorised firms must also outline the characteristics of the relevant consumer segment upon which the suggestion is based.
Given the grey area in which targeted support operates, namely a middle ground between tailored financial advice and more general widely available advice, the regime specifics clear disclosures which must be made to consumers by authorised firms to position the consumer’s reliance on the support appropriately.
Implications for Pensions Providers and Savers
This new regime has significant implications for the pensions sector. For pension providers, targeted support creates opportunities for more proactive and meaningful engagement with customers. Providers will, however, be required to obtain a specific FCA permission to offer targeted support and to demonstrate ongoing compliance with the FCA’s Consumer Duty. Firms wishing to provide targeted support must apply to be authorised by the FCA through its online portal and satisfy prescribed criteria, including meeting a minimum regulatory capital requirement of £500,000.
For pension savers and investors, the targeted support regime makes more tailored assistance available when making critical decisions, such as how much to contribute to a pension, how to invest retirement funds, and how to draw an income in later life. Rather than leaving individuals to navigate these choices alone, or relying solely on high‑level, generic guidance, authorised firms will be able to provide actionable suggestions aligned with a saver’s general profile.
This could include prompting under‑saving consumers to increase their pension contributions, recommending a particular course of action based on available pension access options, or providing guidance on appropriate investment strategies. Importantly, the FCA emphasises that these reforms include built‑in consumer protections. Consumers will continue to benefit from their existing rights, including access to the Financial Ombudsman Service, and will be able to raise complaints in the same way as for other financial services.
Moving Forward
The introduction of targeted support is part of a broader effort by the FCA and Government to improve outcomes in the pensions industry, sitting alongside initiatives such as the recently introduced Guided Retirement enacted by the Pension Schemes Act 2026. By creating this new category of target support, providers will be able to give savers more timely, personalised recommendations without the barriers of traditional financial advice, and boost engagement with pensions and long-term saving.
If you have any questions about the issues raised in this blog, please contact juliet.bayne@brodies.com or your usual Brodies contact.
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