The shackles of the industry are finally being broken but there is still much work to be done
The financial planning profession has incredible potential that sadly has still not yet been achieved. But things are changing and the tide is slowly turning.
The only way to bring about the fulfilment of our profession’s true potential is for us all to break the shackles of the industry. The industry wants advisers to stay focused on the money – not clients. Why? Because this is how it gets its stuff sold.
But this does not build trust. It does not gain respect. It never has and it never will.
So the time has come to break free. The industry is not paying advisers any more. Clients are the ones paying advisers and in increasingly explicit fees too.
Our service must revolve around clients and what they want, not the industry and what it wants – distribution.
Thankfully, I am seeing the shackles being broken more each day.
Take, for example, financial planning conferences.
I have noticed a steady decline – in fact a distaste – for old-fashioned, pay-to-pitch, pay-to-play sponsored events put on by the likes of the Chartered Institute for Securities & Investment and the Personal Finance Society. Advisers are finally seeing for themselves how the industry works.
BACK2Y 2018, which took place last month, was a totally independent, unsponsored yet sold out event. No exhibitors. No sponsors. No free golf balls. Advisers had to dig deep to attend.
More than 500 from across the UK and around the world came to Birmingham’s International Convention Centre to learn about delivering a service proposition that matters.
A service that does not depend on the sale, implementation, review or distribution of a financial product or investment on behalf of the industry. A service that is truly client-focused. The great news is that other independent financial planning events are now coming to the fore, trying their best to do so without sponsorship and the product provider influence that comes with it. Take Andy Hart’s Humans Under Management and Abraham Okusanya’s Science of Retirement.
I know how much it costs and the risks involved with putting on a major conference, so I salute you Andy and Abraham. You do it because you have a message to share and not financial products or sponsorship to sell.
I started BACK2Y in 2014 as a result of a dare. I was expressing to Nick Taylor, a member of my Inspiring Advisers group, how I was sick and tired of product provider influence at the then IFP Conference (now CISI Conference).
I was sick and tired of the free pens, the free iPhone chargers and free golf balls; of the provider pitches and the focus on products and investments. None of it had anything to do with proper financial planning.
So Nick challenged me. “Stop complaining Paul,” he said. “If you really want to do something about it, why don’t you put on your own conference, with no sponsors, no exhibitors, no free pens? Challenge the status quo.”
So I did. BACK2Y is about getting advisers “back to why” they do their job; not to peddle products on behalf of the industry – creating a service proposition all about investment returns, about being top quartile and about charges – but to help clients get a better life. That is our purpose as advisers.
Just over 140 advisers attended the first BACK2Y in 2014. That figure just about covered my costs at the time. I was just pleased that anybody turned up.
So we did another one. And another. This year was the fifth BACK2Y. Without any advertising, without any mentions in the financial press, without any sponsors and without any big email lists (a privilege of the CISI and the PFS) it sold out. I am still grateful and relieved folk turned up.
Meanwhile, it appears that numbers for the CISI Financial Planning Conference are declining fast.
Why should advisers pay a fortune to attend the event and be sold to by the product provider sponsors?
Even the PFS is getting the idea as it attempts to put on unsponsored, genuine financial planning conferences and symposiums. I applaud it.
So yes, the tide is definitely starting to turn. We have an opportunity right now to raise the profile, posture and position of financial planning to its highest possible level.
That means it being done with true integrity and true selflessness, where there are not industry sales games driving the process.
It means lives mattering more than assets under management; when the only thing driving the financial planning process is helping clients make progress in their life, helping them get and keep the life they want – none of which has anything to do with the sale or distribution of financial products.
In a fee-only world, focusing on clients and what they really want is the very thing that earns you your fees and, more importantly, gives you the right to keep those fees.
If advisers want to succeed and prosper in the years ahead, if they want to keep their hard-earned fees, they need to change their focus from money to life.
Fail to do so and clients will gravitate towards the advisers who successfully communicate and demonstrate the fact they care about the right things.
Paul Armson is founder and chief executive of Inspiring Advisers and co-founder of Life Centered Planners