Fresh from completing the acquisition of Bristol-based IFA Morgan Stone Independent in April, financial planning firm UNIQ Family Wealth is doing it all again with a second deal in the pipeline.
For founder Marlene Outrim, the motivation is to introduce more clients to financial planning based on cashflow modelling – and grow her business at the same time.
She says: “We have been growing organically but I just thought one way to do it was through acquisition. I was concerned that consolidators seemed to be buying up people – but where does that leave you as a client? I thought if I could acquire a small business and introduce them to financial planning, that’s one way I could promote financial planning to more clients.”
Outrim is unable to share details of the second deal. On the Morgan Stone deal, she says one director was looking to retire from the firm and one, Sally Moore, has stayed to join UNIQ as senior financial planner.
“We retained the staff at Morgan Stone, and the office, and we’re looking to introduce financial planning to the clients. Although they did get financial planning with Morgan Stone, it wasn’t how we do it – they didn’t use cashflow modelling.”
The recruitment rollercoaster
As well as providing a faster way of growing a business than growing organically, buying another advice firm can overcome the problems that many advice firms encounter while trying to recruit the right staff. In the past, UNIQ has had its fair share of recruitment ups and downs but Outrim, who has just hired a financial planner who is both chartered and certified and taken on a trainee financial planner, has a different approach now.
“We had a high staff turnover. We were taking people on because we needed to and were not as rigorous as we should have been. But now we have a good management team and their instinct was to take a step back; to take time and get the right people even if that means a slight increase in workload for the people already here. And we’ve been outsourcing while we get the right person.”
While the obvious solution to finding staff of the right calibre is to “grow your own” by training people, Outrim acknowledges that doing so can put even more pressure on firms, as staff who are already stretched take time out to train those people.
“We support new people with qualifications – we pay for the qualifications and training. But the trouble is those people want to move and think they can get more money elsewhere. Paraplanners think they can get a certain amount – and some IFAs will pay that money.”
When is a paraplanner not a paraplanner?
Outrim, a former president of the Institute of Financial Planning, says firms that employ people to do a mix of administration and paraplanning are not doing the industry favours by muddying the waters between two distinct roles. She believes they need to be separate in order to give a meaningful career structure and realistic salary expectations based on their skills and experience.
“Some really good paraplanners demand high salaries, but there are others who think they can command the same and this is one of the problems.”
2012-present: Founder and managing director, UNIQ Family Wealth
2007-2012: Certified & chartered financial planner, Bluefin
1991-2007: Managing director & founder, Chambers Morgan James
1990-1991: IFA, Cavendish Financial Management
1990: IFA, Clifton Financial Management
1989-1990: Tied agent, Hill Samuel Investment Services
However, with some firms employing full-time administrators to paraplanning here and there while others wait in the wings with over-generous salaries, these issues look set to remain.
There is a strong sense of fair play in Outrim’s perspective on the advice profession, which is befitting of a former probation officer. Outrim has drawn parallels between the skills she used in that role and those as a financial planner in many previous interviews – perhaps the biggest is earning trust from the people you are paid to help.
However, that did not sit comfortably with her role as a tied agent at Hill Samuel. She found herself falling back on the processes and skills she had learned as a probation officer such as treating everyone as an individual, having no preconceived ideas about them, being clear about what you can do for people and your limitations.
“I didn’t like selling products that I didn’t believe in and had I not joined an advice firm I would have left the industry. I didn’t think I could sell so I asked people around me for ideas. Some were contrived and some deceitful, such as don’t ask clients to sign something but ask them to authorise it or cover it with a piece of paper. Now, as an IFA, I make a point of saying to clients read this before you sign it.”
Outrim’s rationale for launching UNIQ Family Wealth was, as the name suggests, to focus on families. “You may start off dealing with individuals and couples but you end up talking about families. I thought if I set my stall out with a family focus from the cradle to the grave, I’m more likely to retain clients.”
One of the ways in which Outrim is involving families is by working with clients’ adult children. UNIQ has an online investment service for those who do not get the full financial advice that their parents receive and also provides educational workshops that introduce financial planning to clients’ children. “They happily agree to being a trustee and executor or attorney with no idea of what that entails or the financial planning behind it. It’s about educating them so they can do their own financial planning.”
The firm also visits schools each year as part of the My Money Week campaign and encourages children to save by giving them “penny pigs”. “We have introduced penny pigs to give to all clients, their children and the schoolchildren. It’s to encourage saving through the idea of ‘where will your pig take you?’ The idea is if you save enough, you could afford to go somewhere.”
The penny pigs bring fun to financial planning, with UNIQ taking photographs of their pigs in different locations, opening people’s eyes to the possibilities that saving can bring. “Clients have been innovative in their use of the pigs. They put money in to give to their grandchildren or they put a pig in the canteen at work to give to charity.”
What is the best bit of advice you’ve received in your career?
Be true to yourself and your clients. You can’t go far wrong with that.
What keeps you awake at night?
Apart from my husband’s snoring, it’s all the things I’ve got going on and thinking will I have time to do them all.
What has had the most significant impact on financial advice in the last year?
Pension freedoms, which have given consumers a lot more flexibility in how they plan for retirement. Now people can be creative with pensions.
If I was in charge of the FCA for a day I would…?
Make sure they understand what advisers do. They used to send people out to spend time with advisers When one of them sat in on a client meeting with us, he was embarrassed about the amount of paperwork we had to go through.
Any advice for new advisers?
If you’re not really interested in people and in finance, forget it. You have to have a genuine interest.