Alistair Cunningham believes that specialising will increase opportunities for advisers because it differentiates one adviser from another. But the director of chartered firm Wingate Financial Planning thinks it is more important to specialise by giving advice to particular types of clients, such as dentists, or focus on areas such as divorce, than to take specialist exams that may turn out not to be useful.
“‘Specialisms’ [as perhaps gained via an exam] have their uses but are of limited value, while specialising is imperative in this world of many complications,” he says.
“Specialising increases, rather than limits, opportunities for advisers. Advisers should find an area of affinity – it could be the type of client such as doctors or lawyers, it could be a geographical area, or an area of advice such as divorce or long-term care.
“If it’s something like divorce you will get to know the divorce lawyers and they will speak to you as an expert. If you’re only dealing with doctors you will get to know their world and their issues. And who will they go to when they need advice?”
Cunningham, who wanted to be a GP when he was younger, is speaking from experience. At Wingate, which he co-founded in 2008 from the employee benefits firm he joined three years earlier, he deals only with owner-managed businesses, including family businesses, which form part of the firm’s broader client base.
Cunningham has himself taken a specialist exam, the Society of Trust and Estate Practitioners’ Certificate for Financial Services (Trusts and Estate Planning). This turned out to be of limited use to him. “I did it to be different. I had a few lawyer contacts who said ‘you could do it’. It gives you credibility if you deal with lawyers, but I don’t deal with many lawyers and it wasn’t valuable for me,” he says.
Cunningham’s pursuit of that all-important differentiation from other advisers explains his early award of chartered status back in 2008. He expects chartered to become the minimum standard for advisers within the next four or five years.
“Chartered status is a big positive. We were one of the first firms to be chartered and I was personally one of the first chartered financial planners. We did it to be different. Being fee-based and chartered made us different. Now there are 300 to 400 chartered firms and chartered status is not such a big differentiator, which is why we spend more time trying to win awards,” he says.
Wingate has won various industry awards since 2011, including Best Retirement Adviser at the 2014 Money Marketing Awards. Cunningham has also bagged his share of individual trophies, including the Unbiased Social Media Adviser of the Year award in 2012 and 2013.
But this does not mean Cunningham is fanatical about social media. He feels it can be useful, but points out that caution and common sense need to be exercised in the context of financial advice because information can mislead some people.
“It’s the 21st century equivalent of the man in the pub – but this is a pub where several hundred million people might be listening all at once,” he says. “The man in the pub might say ‘I’ve made xyz on this investment,’ and that could mislead people. If the man in the pub said everyone should have a pension, that would be a good thing. But if nobody is listening, the message is gone – and if you do mislead someone it’s indelibly recorded.”
Cunningham feels social media brands such as Facebook and Twitter are of relatively limited use in communicating with clients or potential clients. “Only about 10 to 15 per cent of people are on Twitter,” he says. “Facebook works very well as a social brand where you network with peers but doesn’t fit with what we’re trying to do at Wingate. Or even companies like Wonga.”
Technology is a tool rather than a meaningful way of delivering advice, in Cunningham’s view. “The best way to deliver financial advice is face-to-face. Skype and web conferencing leave me cold, but that’s probably because I deal with people who have more complex needs,” he says.
“You can be a slave to technology but the converse is also true, with some people avoiding it. But just because you’ve always done things a certain way, that doesn’t mean there isn’t a tool out there to help you do it better.”
Cunningham says in the space of six years, Wingate has gone from nothing to a turnover of some £1.5m. “We have a five-year plan in place in growth terms, half of which we want to do organically. But we need to make strategic acquisitions – a team of advisers from a large national or medium-sized regional practice.”
Cunningham expects mainstream advice needs to lessen as financial products become simpler. But he adds tailored advice goes hand in hand with more complex needs and he has concerns about firms relying solely on remote servicing of clients. “If advisers service clients online or in some automatic web-based way, they are going to be in trouble as someone else will always have a bigger technology budget, or they’ll be cheaper, or the clients will no longer need advice.”
There will be winners and losers when the pension reforms announced in the Budget are implemented, Cunningham says. “For those that seek advice, pension reform is positive. They’ll have more options and the majority will benefit. However, those who don’t seek advice, bearing in mind expectations that £3bn in taxation will be raised, then they will be worse off,” he says.
“Reform could lead to innovation like pensions being linked to debit cards, with people spending out of their pension plans as if they are cash. If people are more positive about pensions, it will increase saving. That can only be a good thing.”
What is the best bit of advice you’ve received in your career?
Take nothing at face value – it pays to be inquisitive
What’s keeping you awake at night?
I sleep like a log but have been getting up at 5am due to early sunshine and noisy magpies in the garden.
What is the most significant impact on financial advice in the past year?
The Budget changes to pensions.
If I was put in charge of the FCA for a day I would…
Place more scrutiny on large financial institutions as there’s a conflict of interest between their shareholders and what is right for the client.
Any advice for new advisers?
Specialise. Find areas that you have an affinity with that will leave you passionate, knowledgeable and lead to more opportunities.
2005-present: Financial planning director, Wingate Financial Services/Wingate Benefit Solutions
2004-2005: Nsure Financial Services, IFA
2000-2004: IFA consultant, Friends Provident