Darren Burns, Head of Advice at Graviton Wealth Management

For many independent financial advisers, the past few years have felt like a constant game of defence: more regulation, rising costs, and an ever‑growing list of technologies promising efficiency but rarely delivering clarity – after a three-day free trial and many, many adverts.

However, the data tells a different story when examined from a broader perspective.

Insights shared by Evan Baars, Partner at NMG Consulting, during a recent Graviton webinar suggest that the future of advice in South Africa will not be determined by better fund selection, faster systems, or cheaper pricing. Instead, it will be shaped by how advisers respond to five deeper structural shifts that are already underway.

1. The advice profession is shrinking ‒ and that’s not necessarily a crisis

South Africa currently has approximately 16 000 practising financial advisers and a significant number of these advisers are nearing retirement age, with many actively considering a succession plan, sale, or some other form of exit from the profession.

Regulatory pressure is often blamed for this contraction, but the data suggests something more nuanced: as compliance intensity rises, smaller and less scalable practices struggle to remain profitable. This naturally leads to consolidation ‒ not because advice is failing, but because the business of advice is changing.

The uncomfortable question advisers must ask is not “How do I avoid consolidation?” but rather “What kind of business do I want to be part of in the next decade?” Burying one’s head in the sand and pretending the industry will look the same in ten years is probably the least reliable strategy available.

2. Asset growth is real ‒ but it’s not coming from new money

South African retail savings and investment assets reached approximately R3.2 trillion at the end of 2025, but most of this growth has come from market returns and not new flows.

Consistent net inflows are largely confined to two areas ‒ retirement income solutions and offshore investments.

This has important implications. Growth is not evenly distributed, and advisers who rely on “asset growth by default” may find they’re not growing their practice. Sustainable growth increasingly depends on retaining assets across generations, engaging families rather than individuals, and aligning advice with long‑term financial transitions ‒ not just accumulation.

3. Fee pressure is a confidence problem, not a pricing problem

One of the more thought-provoking insights from the webinar was the comparison between South African and UK advice fees. On average, South African advisers charge much less ‒ both in absolute terms, relative to average performance and as a proportion of the entire value chain. What this means in simple terms is that in the UK the average asset management, discretionary fund manager (DFM) and platform fee, are less than in SA, but the average advice fee is significantly higher.

But the difference is not explained by affordability alone.

In markets where advisers command higher fees, there is a clearer emphasis on holistic professional advice, rather than investment performance. Advisers who focus on planning, process, expertise, and personal connection demonstrate greater confidence in their value ‒ and that confidence directly correlates with pricing power.

Discounting fees, by contrast, often erodes the very confidence needed to invest in better systems, people, and client experience. The result is a vicious cycle that limits long‑term sustainability and usually leaves the adviser working harder for clients who value their service less.

4. Growth is already in your client base ‒ are you leveraging it?

More than 75% of new clients for South African advisers come from referrals within existing client relationships. Online channels, advertising, and professional partnerships play a surprisingly small role.

Yet most advisers describe their referral growth as accidental – or something that happens occasionally rather than something deliberately designed.

This presents a significant opportunity. Advisers who systemise referrals ‒ through clearer client segmentation, intentional engagement with families, and consistent client experiences ‒ can unlock growth without acquiring other practices.

When it comes to acquiring practices, small‑ and medium-sized practice acquisitions, particularly between similar‑sized businesses, often fail due to cultural mismatch and operational complexity. Organic growth, while slower, is typically more durable.

5. Technology is not the advantage ‒ focus is

Artificial intelligence and digital tools are being adopted rapidly, even among older advisers. Today, most use AI for email drafting, meeting notes, research, and client communication, primarily to reduce administrative burden.

But technology alone has not meaningfully improved profitability for most practices.

The real differentiator lies in how intentionally technology is integrated. Purpose‑built, integrated solutions free advisers to focus on what their clients value most: advice, clarity, and human connection.

In this context, DFMs and centralised investment propositions are not merely investment decisions ‒ they are strategic business choices. Leading advisers increasingly delegate portfolio construction to specialists so they can spend more time with their clients and less time watching the markets.

Distinguishing core value from distraction

One of the most powerful distinctions advisers can make in their practice is that between core value‑adding activities and distractions.

Core activities include:

• Financial planning and advice
• Relationship management
• Operational efficiency
• Clear, confident value propositions

Distractions often masquerade as sophistication, particularly in an industry that sometimes confuses activity with value:

• Excessive fund selection
• Chasing short‑term performance
• Poorly planned acquisitions
• Under-pricing advice to stay “competitive”

The advisers who will thrive over the next decade are not those who do more ‒ but those who focus better.

A profession at a crossroads

The advice landscape is not becoming less relevant ‒ it is becoming more demanding. Regulation, demographics, and technology are forcing advisers to decide whether they want to remain generalists juggling complexity, or professionals operating within scalable, supportive structures.

For independent advisers, the question is no longer “Can I survive on my own?” but rather “What environment allows me to deliver the best advice to my clients, at scale, and with confidence?”

Those who engage honestly with that question will shape the future of advice in South Africa ‒ rather than discovering that the future has shaped them.

ENDS