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Nick Bamford: Why I’m not fed up being an adviser

It is hard not to empathise with Richard Bishop when he describes the trials and tribulations of being an adviser as the RDR changes start to bite. But maybe I can paint a “glass half-full” picture instead.

Change it is said is the nick-name used by opportunity. As we are in the business of being financial advisers I guess it is always going to be better to have a more optimistic world view and to exploit the opportunities that come along. After all when clients speak to their adviser are they really interested in hearing about the struggles that adviser is going through? I don’t really think they are.

If they want to be depressed they can go and listen to the financial adviser equivalent of Marvin the Paranoid Android from Hitch Hikers Guide to the Galaxy “the first 10,000 years of the RDR were the worst and then the next 10,000 years were even worse”

How much better an experience the consumer might get if they were on the receiving end of an upbeat message. I honestly can’t see how study in preparation for exams can result in no learning experience that can be applied in the client world.

I hate taking exams as much as the next adviser but really we can all learn from the study (not just the manual but the wider reading that needs to be done- although I accept that most people do just stick to the manual) In my view study can always improve the quality of advice delivered to the client but it does require effort and maybe that is the problem.

RDR is by no means perfect, never said it was, but a lot of the problems being attributed to it are not insurmountable if the advisory business owner, and it doesn’t matter if they are a sole proprietor, partnership or company, small medium or large, takes a more positive attitude towards change.

We have seen it all before and this time round is no different. Forward thinking, positive attitudes and a client centric approach to delivery of advice and service will win through. Sure it isn’t easy but I don’t reckon any of us signed up for easy, if it was easy anyone could do it.

Successful intermediaries, and there are many thousands of them out there, have embraced change. They have pushed through barriers put in their way by some might say heavy handed regulation. They will be successful in the future as they were in the past. It will have everything to do with having a positive mind set. Some won’t make it and honestly that is a real shame, but very, very many will.

Last Sunday morning in minus 1 degree temperatures I ran a 5K race for charity. I hated every moment of it. It was painful. I had not done vigorous exercise for 23 years and my training regime since mid October was curtailed by injury. But I still did it and in a personal best time.

I tell this story not to brag (well only a little- I came 38th out of 102) but because that race was a bit like the RDR. It was painful, it hurt, it required preparation, it required a desire to change, some entrants didn’t show up, but most did and when you get through it you don’t half feel good! My simplistic 5k analogy means that the finish line is just a couple of weeks away- or just maybe that is the start line, I prefer to think it is the latter.

Nick Bamford is executive director at Informed Choice


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There are 15 comments at the moment, we would love to hear your opinion too.

  1. To use Nick’s anaology.
    I like running. I’ve only done one marathon and that was when I turned 40, 4hrs 24, not brilliant, but not bad either considering the furthest i’d run beffore the big day was 16 miles as I’d knackered my knees a it doing runs with 30lbs of kit, boots etc in my 20’s.
    The point is, it doesn’t matter how good for you something might be, i.e. excercise and running, you can over do it. When running I woudl always do a max of alternate days and one long run a week. When kayaking in January in the surf, I only tend to do 1hr as I know anymore than that and being tied I risk making more mistakes and injuring myself or rsulting in getting picked up by the Lifeboat!
    The same is true to say for change and since 1988, all we and more importantly our clients have seen in FS is continual and increasing frequency change. Take pension simpliciation, what a joke that the CII actually still give you points towards your level 4 for an exam that is on a subject that has changed completely and is becoming more complicated by the day.
    Continual change costs our clients money as we have to lean about the changes and explain them to clients. It’s almost as if as churning has decreased, advice churning is on the increase as more advice is needed due to continual change. a bit like the tax complification which keeps occuring.
    KISS please.

  2. Hi Nick,

    Thanks for the upbeat message. Like others I have written negative comments on Richard Bishops blog about the RDR.

    Like you, we will get through the RDR and I trust do OK.

    I use the phrase ‘do OK’ because I don’t think we can thrive until we get an accountable regulator, an end to retrospective reviews and proper English law applied to financial services. If that day ever comes our businesses will be investable and we will be able to expand.

    I would like to see an RDR guarantee. This is the last change for 10 years. We will let these regulations bed in and see if they work. I fear that RDR two is just around the corner.

  3. I agree – As far as I’m concerned RDR is the best thing that has ever happened.

    I used to charge 0.5% pa – now I charge 1% pa minimum with extra charges added when ever possible.

    Being “Qualified” really allows me to charge more and using one of the more expensive and complicated wrap providers ( who will not allow investors to deal direct) allows me to produce CGT reports ( and charge accordingly) and to meet all RDR requirements for the provision of ongoing advice.

    Yes I really do like being a professional. Please increase the exam requirements. Forcing more of the old farts out may allow me to take 1.5% pa or perhaps even 2% plus incidental charges

  4. Incompetent Regulators Award Team 7th December 2012 at 3:51 pm

    What Bishop really meant was he’s fed up with idiotic regulators!

  5. It’s not easy adapting to change particularly when imposed from outside but it’s the career road we have chosen. As Nick says, the majority will adapt, survive and prosper because they are honest, ethical and good at what they do.

  6. Interesting article Nick and I pretty much agree with the sentiment.

    Change happens and we need to adapt. It’s too easy to blame the authorities for everything and overall I too believe that the principles of RDR will be good for clients.

    My main concern is the (short term) complication this has introduced in terms of interacting with certain providers who are only now adapting to RDR and, perhaps more annoyingly, essentially waiting until RDR is upon us before announcing their new pricing structures etc.

    Interesting point by Phil also given this weeks changes in respect of pension limits and comments concerning the implementation of AE for employers.

  7. Nick and Phil

    You both make valid points and I think Phil is bang on when he compares RDR and pensions complification. Change was needed but to some extent we’re going to end up the committee constructed giraffe when a horse was needed.

    RDR in concept is/was good, in practice it is not but as with pensions, the whole process to get to the starting point has been simply torturous and there’s still tinkering and uncertainty.

    Hopefully, once 1st Jan happens we can start to make progress. Change and opportunity are often bed fellows but the change needs to be really good in principle when its execution is not if people will grasp it positively.

    Meanwhile I’m off to see a client who is blissfully unaware of it all – thankfully he usually has a G&T waiting!

  8. Nick I do warm to your sentiment and attitude which is hard to disagree with. Yes change is an opportunity, yes we can rise to the challenge. I doubt I’m alone in thinking that the intentions of RDR are laudable. However, the way in which RDR has been implemented has lacked vision and thought. There does appear to be a lack of partnership with the regulator who gives the impression of not listening and being very single-minded. Consider adviser charging, which is a mess. All we really needed was proper agreements for remuneration between adviser and client with products that all paid the same commission levels… RDR has gone further and created an administrative nightmare for providers and advisers, needlessly costing.. well perhaps billions. This won’t really be clear until the new year, but it will certainly be a “challenge” and I dare say many will be screaming at computer screens as they look at the chaos this causes in their own firms and attempting to explain it maturely to clients, taking care not to simply lay blame at the regulators door and sound like a cornered animal.

    It is a great pity that those that set it up have gone (Mr Sants) the result for most of the public is highly likely to be fewer more qualified advisers, higher fees, requiring higher minimum assets. Ironically, most advisers know their clients and know that they probably cannot afford to pay them what is needed to run a sustainable business in an environment where costs for PI, FOS, Capital Adequacy, Compliance all get ever higher.

    It feels more like a steeplechase than a 5k run and the barriers/obstacles aren’t there for anything other than tripping you up.

  9. I agree with Nick, full of positive news unlike the other article about “Why I’m fed up being an advisor”
    The best will survive, it seems all the doom sayers have latched on to the other article to vent their anger and frustration of the changes.
    Personally I think that it is for the best in the longer term, we may have pain to go through, but I think it will be worth it in the long run.
    Nobody likes change, but change may be for the good.

  10. Sorry Nick I totally disagree !!

    Take the name of your firm ” Informed Choice” this is, I am sure, a reference to your clients and how they will be treated and get advice, however “choice” is something that is denied to us as IFA’s by the FSA and should I say government.

    We are constantly denied to be able to “choose” for ourselves IE-: exams, how we are paid, fees, levies etc etc etc,we do it or suffer the consequence, the one thing we are allowed to decide for ourselves is whether we continue to be an IFA or not !! This I think is part of Mr Bishops gripe ?

    Congrats on the run by the way !! I suppose you had the choice to do this or not or is this another directive from the FSA I have not been aware of ?

  11. Not surprised that someone has taken this line,although in truth there is another name that springs to mind who I thought would be in like Flint as the saying goes.

    “After all when clients speak to their adviser are they really interested in hearing about the struggles that adviser is going through?”

    No of course they are not which is why these sentiments are expressed to our peers via the financial services media and not to clients.

    “…and a lot of the problems.. are not insurmountable… if they are a sole proprietor, partnership or company, small medium or large, takes a more positive attitude towards change.”

    But there is change and there is change. None of the changes, as many of us have said already, are necessary in their present form. We should not welcome change-only change which is genuinely necessary and beneficial. The RDR produces neither.

    “They will be successful in the future as they were in the past. It will have everything to do with having a positive mind set.”

    Of course that’s the secret! Well, we’ll go on listyening to Marvin the Paranoid as you suggest. And you carry on listening to those little men with wings you see flying around the dustbin at the bottom of your garden…

  12. AS IRAT said, I actually don’t think Richard really meant he was fed up with the business, and nor do I think he was seeing a half empty glass, but rather veiwing the myriad stupidities that have been thrown at us, which it’s hard not to feel hugely frustrated about.

    I do agree with Nick though that there are very many reasons to be positive and enjoy what we do, despite the continuing inadequacies and muddled thinking of those to whom we have to answer.

  13. Roll on RDR 2, which Wheatley has already said will happen.. I can hardly wait. My enthusiasim knows no limits.
    I am not fed up either, I am almost demented trying to keep up with it all.No doubt I will get it altogether only to have to change it all again.
    If I had my time again an IFA is the last thing I would be, in fact I would keep as far away from anything to do with FS as possible.

  14. To anonymous who delights in calling himself “professional” so he can charge more, shame on you. RDR will change very little except allow advisers like “anonymous” to suck the blood of their clients.

    I received a phone call on Thursdsy afternoon from a distressed referral, who has been “persuaded” by a “professional” (who has left working for a bank and now works for a direct sales organisation) to sell her investments and reinvest causing a large CGT bill. I suspect the “professional” understands how CGT works so this is another case of negligent advice. The advent of RDR does not seem to have wiped out greed which isat the root of most financial scandals.

  15. Anon @ 9.50 8 Dec

    Oh dear !

    I think you will find that the anonomous post you refer to was being ironic !! in outlining why the RDR is a dogs breakfast !

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