A direct-to-consumer website offering risk profiling and cash flow modelling for free is developing a model for a web-based advice service which charges clients £60 an hour.
Money Guidance first launched in July 2012, offering access to FinaMetrica and Voyant’s risk profiling and financial planning tools for free. The company was forced to remove the FinaMetrica tools a month later after FinaMetrica said it was unaware of the launch plans.
Money Guidance has now been set up under a new Community Interest Company structure, and says as a result FinaMetrica has now agreed to be part of the new site. Voyant has declined to be part of the service.
The Money Guidance website will be made up of three services. It currently offers financial ‘guidance’ with risk profiling from FinaMetrica and cash flow modelling from MoneyVista, a service owned by Royal London which allows consumers to view their finances, including their current account and investment portfolio, in one place.
The second service is a white-labelled D2C platform powered by Investment Funds Direct Limited, also owned by Royal London and which powers the Ascentric platform and adviser platforms including Succession, Towergate and Openwork.
The D2C platform, offered as part of the Money Guidance ’Premium’ service, has an annual cost of £50 and offers access to IFDL as well as research, industry updates and news.
Consumers will also have to pay the IFDL platform charge, which is tiered from 30 basis points to 10bps.
The third service, currently under development, is an an online advice model with an approximate fee of £60 an hour.
Money Guidance is jointly owned by advisers Alan Cheetham and Philip Dodd, and is an appointed representative of advice firm Alan Cheetham Asset Management.
Money Guidance managing director Philip Dodd, who was formerly an IFA with Cullen Financial Planning, says the web-based advice service will offer fully regulated advice, and will take on the liability for advice.
Consumers will complete a questionnaire before receiving remote advice from a chartered financial planner. The firm plans to employ chartered financial planners to give advice through an online calling facility such as Skype.
Dodd says the cost reduction involved in removing face-to-face advice will allow the firm to offer web-based advice at £60 per hour.
Money Guidance has been granted Community Interest Company Status, which means the firm can only issue a maximum of around a third of its profits in dividends to shareholders. The rest of the profit must be reinvested in the company. CIC registered companies also have to apply for the status and satisfy government that they deliver community benefit.
Dodd says: “Traditional investment initiatives have come to be regarded with suspicion, and so a financial services business involving publicly-earmarked profits and assets should go a long way towards restoring trust. Our website provides investors with essential financial guidance combined with low-cost execution services.”
Dodd says the Money Guidance site has generated 35,000 hits since launch. He hopes to convert 10 per cent of visitors into paid clients onto the web-based advice or Premium service.
FinaMetrica was unavailable for comment.