When Money Honey Financial Planning managing director Jane Hodges started her financial services career, computers were more likely to be polished and admired like trophies than used.
“I started work in the back office of GT Unit Managers, where my job was to keep a giant paper board up to date with all the trades done in the dealing room, then follow a piece of paper around the office ticking off when contracts and settlements had been completed,” she says.
“There were no computers anyone actually used; they were mainly just status symbols”
Since co-founding her previous company, Alexander House, in 2013, Hodges – who was recently appointed vice-chair of the Personal Finance Society’s Financial Planning Practitioner Panel – has aligned herself with a completely different era where computers are there to work hard, not look pretty.
The thinking behind Alexander House was to be a remote business and use everything technology had to offer.
“Our vision was no offices, the use of cloud-based technology and no paper. So electronic signatures, electronic communications, just imagine never printing or posting anything. Everyone was trained on how to work remotely and use video-conferencing for internal and client meetings.”
Technology’s usefulness even extended to an after-work drink.
Hodges says: “We used to have virtual gin and tonic meetings on Friday evenings where anyone could join with a drink from the comfort of their lounge and we would natter away for an hour or so, in the same way others might go to the pub after work.”
Digital-only advice firm Money Honey was set up by Hodges earlier this year in a similar vein. “I left Alexander House [an appointed representative of Caerus] last year as I wanted to run a directly regulated business,” she says.
“Money Honey is about empowering clients to ask for the service they want, saving money and fees by working digitally only and then actively planning their financial future alongside a trusted adviser using all the amazing tools available to us now, such as cashflow modelling, online risk tools and client portals.”
Money Honey’s clients are offered the choice of guidance, self-service and full advice. Do they understand the difference?
“Clients are not stupid. They are perfectly capable of choosing how much they want to spend on services and how much help they need,” says Hodges.
“The internet informs them and technology empowers them. Some just have basic needs or need a little bit of guidance to make their decisions, while others have more complex needs or need more support and advice.
“The range is designed to make something available for everyone. I don’t think there is any problem signposting to a client when they are getting and paying for guidance and when they are moving into a more formal advice process. This is helped by our long-term philosophy that everything should be recorded, so there is no confusion.”
2017-present: Managing director, Money Honey and founding director of 4theRecord Compliance, formerly Total Plus, since 2012
2013-2017: Chief operating officer then compliance consultant, Alexander House Financial Services
2011-2012: Chief operating officer, The Consulting Consortium
2001-2011: Variety of roles including head of direct and head of customer services, Sesame Bankhall Group
1991-2000: Personal financial adviser then policy officer/project manager, Halifax
1990-1991: Financial adviser, Allied Dunbar
1984-1989: Data coordinator, GT Unit Managers
To Hodges, providing advice remotely is not much different to the traditional face-to-face approach, providing everyone knows how to use the technology. Dealing with clients electronically relies on them buying into that approach and feeling confident using the technology. That is why the firm runs 20-minute “tech top-up sessions” for clients that are free with the self-service and full advice services or £25 a session.
“We know many clients have portals and never use them. So we do everything we can to make it easy. We teach them how to download the software, how to join a meeting and how to access and register for their portal. Then we ask them to complete their own core fact find so that it is all done before the first know your client meeting and we can focus on the important bits such as attitude to risk, affordability and specific objectives.”
She says the approach goes down very well with clients.
“This weekend I was carrying out a fact find meeting on Skype4Business at 8pm for an hour. The clients loved it and I didn’t mind accommodating the best time for them as I could do it from my own living room.
“Skype4Business lets you draw on a whiteboard, share presentations and documents and play videos, all the while recording every detail. The portal then allows us to share important documents and send secure messages. The clients can then track current values against the goals they have set. What is not to like?”
That said, Hodges recognises not everyone in the industry shares her enthusiasm for all things digital. She feels that outdated product providers and lenders who still want wet signature letters by post are standing in the way of progress and reducing overheads that could then be passed on through cheaper services to clients. She also finds the attitudes of some advisers baffling.
“I am often amazed at how advisers hide their head in the sand about what the future looks like. I am occasionally on industry panels at conferences and talk about what I do, and I always get people coming up to say how impressed they are. Occasionally they follow up with ‘but my work is so complex I couldn’t possibly do it by video’. Well guess what? My work is just as complex and I manage to easily. “
Hodges also built a career in compliance and previously worked for Sesame Bankhall. Given that Alexander House was set up as an appointed representative, what are her views on networks? After all, some commentators have spent years saying their days are numbered, yet they still live to fight another day.
“It is definitely interesting seeing them from both sides of the fence,” says Hodges. “There are loads of small firms and advisers that need what networks offer – ready made processes and procedures, research, compliance resources, capital adequacy. When we set up Alexander House from scratch that was exactly what we needed. But you have to concede control and adopt the network’s risk appetite, which by default has to sit with protecting their business and its shareholders. When they are so big the only way they can do this is to be very prescriptive.”
Some advisers need this level of support and prescription provided by networks while others do not, so for them direct authorisation may be suitable. Hodges says: “If you think direct authorisation is an easy option you are probably better in a network. It is definitely not an easy or cheap option. But I must admit I am so much happier going it alone. “
What is the best bit of advice you’ve received in your career?
Don’t ever accept ‘we have always done it this way’ as anything worth listening to. Look to the future and be ready for it.
What keeps you awake at night?
Product providers’ refusal to work digitally, even when common sense is completely against them.
What has had the most significant impact on financial advice in the last year?
Acceptance of robo-advice/automated advice solutions. The number of people before that were determined it would never happen was unbelievable. The FCA’s acceptance of them has helped enormously.
If I was in charge of the FCA for a day I would…?
Force all providers to accept digital signatures; put a 15-year long-stop in place and get the FCA to do webinars so it can guide more advisers.
Any advice for new advisers?
Always strive to be as good as you can be; never cut corners with customers and never assume what you learn one day will be the same next year.