There is a new person in my office today. Andy joined the Informed Choice team this morning as what we call an “assistant paraplanner”. He is effectively an apprentice but outside a traditional scheme. Perhaps “trainee” is a more appropriate job title.
At a time when new entrants to retail financial services are declining, it is great to be able to offer employment to a school leaver passionate about becoming a financial planner in the future.
The particular career route he has chosen – learning on the job rather than attending University to earn a degree – makes a whole lot of sense. As well as avoiding a load of debt from time spent in higher education, working alongside experienced practitioners means acquiring practical knowledge quickly and getting a head start on his peers.
He will also obtain professional qualifications in a similar timescale to getting an honours degree. We will be coaching him through the CII diploma in regulated financial planning, before moving onto chartered financial planner and/or certified financial planner status.
Who needs a degree in business studies when you are already a chartered wealth manager in your early twenties?
Of course, employing an apprentice or trainee is not without its risks and drawbacks. We could invest a significant amount of time and money in Andy only for him to leave when a better opportunity comes along.
He might decide after a year or two that the sometimes-crazy world of financial planning is not for him. Should that happen, we lose our investment. This means we need to get some value out of him quite quickly, in terms of his contribution to the business and revenue.
Working with an apprentice is also time consuming. We give people a great deal of autonomy here, with certain controls in place, of course, in order to be more productive. With someone entirely fresh to this world, that is not going to be possible. As a firm now consisting of 11 individuals, we do not have the human resources to devote to full-time training and mentoring, so the addition of a new inexperienced team member is going to be a struggle from a time perspective.
However, without the willingness and ability to hire trainees, it is hard to see from where the future of this profession might emerge.
Sure, there will be some who will choose to change careers later in life (anecdotally, I understand former teachers often make good financial planners as a new career option in the decade or so before retirement) but the traditional route of working for a product provider as a broker consultant, becoming professionally qualified and then joining an advisory firm as a trainee IFA looks to be missing.
Perhaps this is the real problem with the so-called advice gap: not the inability to serve the mass market with product flogging from banks but the inability to seed the future professional financial planners with relevant and transferrable experience.
Martin Bamford is managing director of Informed Choice