Looking at the key platform trends from the past year or so, Rich Mayor shares some predictions about what could be next for the advised platform market, whether we’ve now hit peak outflows and if tax planning and investment-led advice could take centre stage once again.

Here follows the lang cat take on what we think we’ll see in the platform sector for the rest of 2025 (and a bit beyond).  

What we expect to stay the same

If you’re a keen watcher of platform numbers, you’ll know that outflows from advised platforms have been increasing over the past couple of years, and particularly so towards the end of last year.

Full disclosure, we mentioned this last year, but we expect outflows to remain elevated. For us, this is still likely to form a prominent strand in the platform numbers equation.

More accurately, we expect outflows to fall in 2025, but that they’ll continue to be well above what we’ve seen historically.

Increased competition from annuities is projected to continue, but annuities also provide security and peace of mind in what – to put it mildly – has been a rather volatile start to the tax year.

With advisers set to encourage gifting and the spending of pensions ahead of the IHT changes, combined with the record outflows from ISAs and GIAs, it’s likely to be another year where net sales are harder to come by for platforms than they have been in the past.

What we expect to be different

The traditional dividing lines of what was life co and what was platform business are becoming increasingly blurred. In other words, platforms are becoming more lifelike.

In investments we’re seeing an increase in smoothed funds that can properly work alongside an existing CIP on a platform.

These aren’t the same as the with profits funds of the past and all work differently. They can be run alongside existing CIPs – in house or outsourced – and don’t be all that surprised if there are tie-ups between MPS and smoothed funds in a combined effort to manage volatility.

The proof of the pudding is in the eating, and 2025 looks to be ‘proving time’ for the various smoothed managed doughs.

Previous research tells us that smoothed and with profits funds’ mechanisms haven’t always acted how advisers expected, so there’s a chance to showcase how they’ve evolved here too.

What we expect to make a comeback

If you can forgive the somewhat lacking description, advice has shifted from ‘traditional financial advice’ to ‘financial planning/something similar’.

The profession has generally moved away from things like product and investment construction and tax optimisation in favour of outsourcing things like investment construction to put the focus on financial planning.

We’ll come up with something better in future, but we mention this because there may yet be a return to the more traditional end of the scale. The CGT changes and proposed changes to IHT and pensions are fairly sizeable, and are being made to products that have largely remained pretty stable and predictable.

The resurgence of annuities, bonds and trusts indicate a return to product selection and tax optimisation. The platforms that support these elements will likely fare well.

This is an extract from State of the Platform Nation 2024/25, available to download now for adviser and provider subscribers via Analyser.

If you’re an advice professional wanting to get hold of SOTPN, it’s included as part of an annual Everything Analyser subscription. Find out more

If you’re a provider wanting to access the report, get in touch – your organisation may well have access already.