The problem is the financial planning industry was built on product sales.
Starting with insurance then managed funds, then superannuation and more sophisticated products as the world and laws became more complex.
Unfortunately the advisory industry has trained advisers into believing they provide all these products and services to their clients as well as continuing to be an expert, not just in one field but now many! The result that naturally has evolved is that less value can now be delivered to the client due to the adviser’s knowledge and capacities being stretched, since they are now responsible for multiple complex disciplines.
As soon as adviser’s realise that their most valuable asset to the client is ensuring understanding a client’s needs and setting and adhering to a realistic long-term strategy to achieve a desired outcome for that client. Doing this with first rate client service and a strong projection of trust and professionalism are the keys to success.
Let me give you an analogy to assist. let’s say its Grand Designs!
Imagine you wanted to build your dream home.. The goal generally is to move in and reside in the dream home rather than the process of the dream home build, correct.. however the process of finally residing in your dream home may take three alternative paths.
- You could decide to build the dream home yourself. You become the electrician, draftsman, plumber, carpenter, brick layer, tiler, council planner/approve, and client. You learn and do everything yourself. It takes time, you learn skills to to yourself, you can save money (or not) but eventually you get to reside in your dream home.
- You are the project manager. You have an idea of what you want your dream house to look like and you then hire the electrician, plumber, carpenter, draftsman, council/ approve and yourself as the client. Again this is another approach however this time you have hired specialists and you must organize and orchestrate the build so that it rolls out efficiently, on time, under budget etc… Again using this approach you can get some of the work done for you however the challenge is in efficiently project managing everything when it may not be your strength. However the end result still is that you get to live and reside in your dream home.
- You hire the architect/project manager. They discuss with you your visions, aspirations, costs, time frames, expectations and then once agreed engage their team of experts to build your dream home. Generally the headline cost may seem excessive however if you were to factor in your own time, loss of earnings (due to distractions), relationship issues etc… that are symptoms when creating ones dreams it has been found hiring a professional architect/ project manager and team more often than not saves money rather than adding to ones expense.
You each of us we will draw our own conclusion as to which path we feel there is the most value.
The financial planner who can lead an manage a team of specialists, is someone who can deliver immense value to the client, as they will have a deep understanding of where the client needs and is working to be, and they will liaise, manage and organize the process where professionals can contribute in an efficient and proactive way to give the client the greatest chance of success in achieving their goals, save the clients time, heighten their trust in their adviser and ultimately be advice worth paying for.
Peter Horsfield founder of SMARTadvice has provided tailored solutions to individuals from 1998. Recognized 2007, 2008 and 2010 as National Advisory Practice of the Year in Australia.
A Certified Financial Planner since 2003. The CFP accreditation is the highest level of certification awarded to a financial planner. Internationally recognised, the CFP mark represents an uncompromising standard of excellence and demonstrates his commitment to financial planning.
To contact Peter go to SMARTadvice