Back in the day, the things you could do for a client could be described on the back of a fag packet: life cover, a savings plan and a mortgage for a life of 2.4 children in a strong family set-up.
All other money was used to buy stuff like there was no tomorrow and the economy motored. It required simple product lines and attracted people to become advisers from all walks of life.
It was the type of environment a robo-adviser could probably have excelled in. Except robo-advisers were not around then.
Now they have arrived things are not so simple. The disintegration of the traditional family structure has created some extremely complex intergenerational needs. Families are growing apart, yet living longer, struggling to manage by themselves.
This is against the backdrop of state provision falling away, with pension policy and social care seemingly a constant source of easy pickings for the Chancellor. Any perceived improvements have simply been a rearrangement of deckchairs.
The social demographic divide between the rich and poor, especially between the old and young, is now even greater. The big consumer spend is over. The “Haves” need little more now and the “Have Nots” cannot afford the goods that would normally keep the economy motoring. Together with the political world flexing power muscles by testing missiles and building walls, it is with little wonder we are reminded about how difficult the future looks for investment returns.
A choice needs some advice
To overcome the prevailing sense of injustice, the UK Government liberated us into having “freedom and choice” in what we can do with our money, particularly around retirement arrangements later in life.
But while there is more information and products available than ever before to make decisions, when people are time poor, they do not want more. For, with confusion winning and cyber opportunists circling, there is an overwhelming desire to be able to turn to someone who can be trusted to wade through the stealth of annual allowances and tax breaks in order to grow and protect money.
In short, the need for an adviser is even greater than ever before. The vast areas of advice are disciplines in themselves, such that it is difficult to be a generalist. Hence the rise of the paraplanner.
Who would have thought it back in the day? But with added complexity making it difficult for those from all walks in life to enter the industry, advisers are diminishing in numbers just as increasing numbers are looking to turn to them.
“There is an overwhelming desire to be able to turn to someone who can be trusted to wade through the stealth of annual allowances and tax breaks in order to grow and protect money.”
We can get angry about the regulators making seemingly endless changes to how we should be advising but, overall, authorities have been good to increase our value. This has helped us to both increase the need for advice and develop as a profession.
Unfortunately, it has meant some advisers being driven out. For those that remain, however, their worthiness is golden and there is a lot to do.
Mel Kenny is a chartered financial planner at Radcliffe & Newlands. Read more of his columns here.