In these litigious and spin-filled days, the public is increasingly suspicious, particularly of politicians.
Trust and integrity have for so long quite naturally been taken for granted. This is no longer so and, sadly, in the financial services world, the end result is an increasingly sceptical consumer.
Investors are more than ever wary of taking advice and in many cases no one can blame them. There is a perceived lack of regulatory teeth, no confidence in pensions, corporate theft, so-called endowment and transfer scandals – the list goes on.
Yet we know that more than ever, the public needs to provide financially for the future and to get quality advice it can trust. This is an exciting and great opportunity for IFAs.
Provided we can overcome the bad press, Consumers' Association scaremongering, Coronation Street script writers, increasing costs, price capping, etc, the future is really bright. If we do the job properly, with real client care, we will thrive.
It does mean working in smarter and leaner ways and fully embracing technology. Some IFAs will not cope but those who work smarter will survive and thrive.
We are a three-RI firm yet growing steadily, with five admin support staff. Proud of our standards and our client loyalty like so many other IFA firms, over 10 years, we have sensibly built a high level of fund-based income. This has held us in good stead and enabled us to provide high levels of service to our clients and to plan our future with confidence. Our clients expect high levels of care. Many were referred to us by their solicitor or accountant and a few by their stockbroker.
Ah, stockbrokers. Go on, guys, burn those braces, roll up your sleeves and form links with quality IFAs. We will agree to protect your client and might even pay you a share of our fee/commission. We are not bond-floggers, as you like to think of us, but we do look at the wider picture, including equities, long-term care, protection, etc.
We might also send you clients, (yes, we do have quality clients). You need to provide your clients with added value and a wide range of services. If not, the banks will.
Hmm, banks. I am increasingly puzzled as to why so many people go to their bank or building society for investment advice. Over-zealous counter staff left one of our elderly clients afraid to go to her branch. She has a fairly high current account balance and that is her choice but the bank staff grab her every time she goes in for a guaranteed bond or some other inappropriate product.
Our clients are always happy to recommend others to us and that, for any professional, is the best source of clients. Solicitors and accountants who understand IFAs and how they work can have a very useful relationship and can provide a valued additional service for their clients.
This is a real area where IFAs can assess the client's requirements, relieving the professional introducer of that burden of the responsibility of giving financial advice. Remember the ever-increasing and litigious clients/beneficiaries who consider that the solicitor has “implied that equity advice is appropriate”. “Why did you suggest a stockbroker and not the wider services offered by an IFA?” There is no magic answer in developing solicitor and accountant connections except to keep close, do not be a nuisance and yet add value to their client relationship. Keep them informed, involve them where necessary and look after their client along the way.
A good measure of whether a professional link will work is if they are prepared occasionally to buy you lunch. If they see the IFA as a meal ticket, then watch out, they are probably not treating you as the professional you are.
We are aware that to survive as an IFA we need to be constantly improving our systems, knowledge and client services. There are some great opportunities out there for the big number of quality IFAs that exist. Form links with other IFAs and professional connections and enjoy a great future.
Arnold Wills is business development director at A Wills & Co