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Tax Planning – Special delivery

In recent columns, I have been expanding on my view that, increasingly, the role of financial advisers and, thus, product providers distributing through advisers, is to offer complete solutions to people&#39s financial needs rather than just products.

Last week, I began to consider how financial management groups, in particular, can play their part in making a paradigm shift towards providing wider product-related solutions.

I have talked before in this column about the ability of fund management groups to construct and provide an effective, flexible and client-centred “future fin-

ancial security” programme which is focused on effective fund management.

At the heart of the programme will be the core-competence fund manage-

ment capabilities of the product provider.

By marketing the full range of potential fund management wrappers from Isas through to Individual Pension Accounts, traditional and stakeholder

pension wrappers and, of course, ordinary Oeics, unit trusts and investment trusts, the fund manager moves closer to being a solution provider for the IFA and the IFA&#39s clients.

The role of the IFA will be to determine not only which funds to select and manage but also which wrapper or wrappers most accurately deliver the objectives the client has expressed (hopefully in plain English) that he wishes to secure.

For example, for a client who expresses a clear objection to having to take benefits from his retirement fund in the shape of income via an annuity or drawdown, maybe an Isa or ordinary Oeic, unit trust or investment trust wrapper would be more appropriate.

At this point, it is also worth mentioning that, just as insurance companies need to ensure that their “communicators” understand how the fund-based alternatives work and how they compare on an objective basis to insurance products, so the fund management groups need to understand how insurance products work so as to understand fully their pros and cons and to accept where these products may be more appropriate for a

particular client than those being delivered by the fund management group.

Looking at the Treasury&#39s document on IPAs, it seems clear that fund management groups are very much in favour currently with the authorities. No doubt, these groups will exploit this potential marketing advantage in presenting their offerings to financial advisers and the potential buying public.

However, it must be reiterated that, as for the life insurance companies, if they are to secure valued and valuable relationships with key advisers, they need to be reflecting what advisers need to do to secure valued and valuable relationships with their key clients – namely, providing complete solutions as opposed to merely delivering financial products.


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