Pete Matthew: From dismay to faith on IFP/CISI merger


When I first heard the news about the IFP and CISI  proposed merger my initial reaction was disappointment. I love the IFP and all it stands for. Sitting the CFP qualification was a lightbulb moment for me, which marked the beginning of my transition from a transactional adviser to one focused on financial planning done right.

I love the fact the IFP is small. No, small is not the right word. Concentrated. Its members are at the very top of their game and my experience of sharing knowledge and best practice with them has been significant.

So my initial disappointment was more of a concern that the intimacy of the IFP might be lost if it is subsumed into CISI.

However, any misgivings I might have are entirely outweighed by my unswerving conviction that those who will be making the decision this month are as passionate about the IFP and the profession as I am. For that reason, I am resting easy that the decision will be made in the right spirit and for the right reasons, and all possible effort will be made to ensure everything good about the IFP is preserved.

It seems one of the reasons for the proposed merger is the size of the IFP relative to, say, the PFS or CISI has been a barrier to it achieving its larger long-term aims. That may well be true. I can see how the greater size and resources of  CISI could have a positive impact on the development of the profession here in the UK.

At the same time (and here is the segue) I read with alarming regularity the chief executives of large advisory consolidation firms postulating the era of the small IFA is dead. Apparently the only sustainable business model for the future is large regional or national advisory firms. To this I say “hogwash” but only because this is a family paper. In reality, I use far stronger words.

I just do not buy the logic that small firms cannot survive in the modern regulatory and business environment because it bears no relation to my everyday experience. Mine is a practice of six advisers and seven staff – not small but by no means large either. We are very profitable, are growing strongly and have a clear plan for the next three years to double turnover and profit.

In Penzance, which is about as provincial a town as you can get, there are several one- and two-person practices, which all seem to be doing well. One adviser told me this month he is no longer taking on new clients as he has more than enough work from his existing book of business. He is not failing either, then. Meanwhile, another local firm was bought/merged/assimilated into a huge national consolidator last year and we are picking up its clients that are complaining the local touch (very important to the Cornish) has been lost.

So, small is still beautiful for advice firms but bigger is better for professional bodies. It appears one size does not fit all. And that is the way it should be.

Pete Matthew is managing director of Jacksons Wealth Management