Only 39 per cent of advisers feel that the tax implications of facilitating adviser charges through products have been explained adequately. And over half of those advisers feel, to a degree, let down, either by the regulator or by product providers, with what they perceive as a distinct lack of detail and a failure to dialogue appropriately.
There has also been a bit of commotion caused by conflicting provider interpretations of the implications. No surprises there.
Confusion rules for many advisers at this time and it is clear that further guidance and clarity on the issue is needed and would be welcomed by advisers. So, yet more uncertainty to pour over a bowlful of ambiguity. Nice. In the meantime there are huge suitability implications rumbling below the surface as the method of payment for advice potentially impacts the client from the point of view of tax optimisation. As such, part of the advice proposition must necessarily include clear direction regarding the most suitable means of paying for it, taking into account the individual client’s circumstances.
Good advice is more than giving the client what they want. I’ll be looking at this in more detail next week but first wanted to address the collective holding of breath while a good portion of the industry waits to see the lie of the land. But can we afford to pause?
Contrary to popular opinion, good decision making is not about turning uncertainty into certainty. There’s little advantage to be gained from waiting until the dust settles and for the vista to become clear. Because it seldom does before fresh activity kicks up more dust.
We need to be comfortable living with the discomfort of imperfect vision. The reality is that strategy is about making choices in an environment of uncertainty. No choice made today can make future uncertainty go away. Those that thought that things would become calmer once they got over the line on January 1st could be in for a few surprises. As the Harvard Business Review points out: “The best that great strategy can do is shorten the odds of success”. None of these bets can be guaranteed.
Strategy and decision making means making the best possible choices you can make today and then being responsive when the bets do or do not come in as hoped. In essence, it’s about saying “this is what I think will happen” (based on the information available and your own good judgement), watching what does happen, and then updating the strategy based on the newest information.
Phil Wickenden is managing director of So Here’s The Plan firstname.lastname@example.org
All quotes have been taken from interviews with qualified financial advisers