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Financial Advisory Launch Programme · Stage 2 of 10
Money & Foundations
Put the money and the legal footing under the firm: a clean business account, your indemnity cover, your capital, and your data registration.
How long
2–3 days (PII can take weeks to secure)
You’ll have
Bank separated, PII in place or quoted, capital and ICO settled
Steps
4 steps
Resources
2 resources
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01 Step 01
Step 01
Open a business account and separate your money
Clean separation of firm money from personal, and from any client money, is the foundation for both bookkeeping and compliance.
Do it yourself
- Open a business current account in your registered company’s name.
- Decide deliberately not to hold client money at launch. The vast majority of advice firms don’t, because it adds a heavy prudential and permissions burden.
- Set up bookkeeping from day one so your adviser-charge income is tracked cleanly.
- Ring-fence a starting float for the fixed costs this module and your software stack will list.
Common mistake · Assuming you’ll sort the accounts out later. Advice-income reconciliation, matching provider payments back to clients, is fiddly and far easier if it’s clean from the first payment.
Time~half a day to open CostModest account fees DifficultyEasyResource for this step
PDFLaunch cost and cash-runway worksheet
Every fixed cost from these modules in one place, with a break-even estimate.
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02 Step 02
Step 02
Put professional indemnity insurance in place
PII is mandatory and continuous for advice firms. You cannot advise without it, and it is typically the single largest fixed-cost line.
Do it yourself
- The requirement: a personal investment firm must hold PII at all times under the FCA’s rules (IPRU-INV 13).
- Minimum indemnity limits are set in euros under the Insurance Distribution Directive, currently around €1.3m per claim and €1.9m in aggregate (roughly £1.1m and £1.7m).
- The policy generally can’t require an excess above £5,000 per claim unless you hold extra capital against it.
- If you are an Appointed Representative, confirm what your network arranges against what you must buy, because many provide or mandate cover.
- If you are directly authorised, get quotes early from a specialist PII broker and declare your advice mix accurately.
- The FCA sets the minimums; your broker or network confirms the cover is adequate.
Common mistake · Under-declaring your advice mix, for example leaving pension transfers off the form for a cheaper premium, which can void the cover exactly when you need it.
TimeDays to weeks to secure CostIndicative, material and rising: treat it as one of your largest line items DifficultyMediumResource for this step
PDFPII readiness checklist
The information a broker will ask for, the minimum-limits reference, and the excess and exclusions to watch.
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03 Step 03
Step 03
Cover your capital requirement
A directly authorised advice firm must hold minimum regulatory capital continuously, and getting the number right protects your permissions.
Do it yourself
- If directly authorised, the capital resources requirement for a typical advice firm (a B3 personal investment firm) is the higher of £20,000 or 5% of annual investment-business income, so a new firm works to a £20,000 floor.
- Hold it as genuine, available capital, not money tied up elsewhere or double-counted.
- If you are an Appointed Representative, the permissions sit with your principal, so this generally rests with the network. Confirm it in Get Authorised rather than assuming.
- Record where your capital sits and how you would evidence it.
- The calculation is FCA-set (IPRU-INV 13); confirm your figure with compliance.
Common mistake · Budgeting for setup costs but forgetting that, if directly authorised, the £20,000 floor is money that must stay in the business, not be spent on launch.
Time~half a day to plan Cost~£20k held capital if directly authorised DifficultyMedium -
04 Step 04
Step 04
Register with the ICO for data protection
You’ll process a lot of sensitive personal and financial data, so you must pay the data-protection fee and stand up basic data governance.
Do it yourself
- Register with the Information Commissioner’s Office and pay the fee: Tier 1 is £52 a year for most micro firms, Tier 2 is £78, as revised in February 2025.
- Note that it dovetails with the AML and Consumer Duty data obligations in Get Compliant.
- Put a basic privacy notice and data-handling process in place before you take a single client’s details.
Common mistake · Treating ICO registration as optional admin. It’s a legal requirement the moment you process personal data, and it underpins your client-facing privacy notice.
Time~1 hour Cost£52/year DifficultyEasy
What you’ll have after this stage
- A business account with firm money kept separate
- PII cover in place, or quoted and ready to bind
- A clear line on your capital requirement by route
- ICO registration and a basic privacy notice