Referring The Right Clients

1948: Speed to Spare – Berke

Referring Good Service

One of the advantages of the internet is that some tasks are made considerably easier. My dishwasher seems to demand salt on a fairly regular basis and I imagine that this is the reason for the speed at which some of the moving parts had decided that enough was enough. A quick check about my model number and an online search took me to several sites for spare parts. I am happy to report that the washing machine now works as it should and the service, as brief as it was, worked well. However a disadvantage of technology and a society obsessed for “feedback” has meant that I receive a regular stream of emails asking me how things went. As I tend to have enough to do in the course of a working day, I haven’t got around to responding. However, this is really an attempt to get me referring the right clients, the latest email suggests that if I recommend eSpares to friends, I will get £5 off my next purchase. I’m sure this is well intended, but I am hoping that I’m not going to need that many spare parts for my dishwasher in the near future and frankly when I next do, I’m almost certain to find that they are out of date or I’ve lost the code.

Referring the right clients

This got me thinking, what is a good approach for referring the right clients to me. Frankly I don’t know the answer to that question. I occasionally remember to ask clients if they wouldn’t mind writing a line or two explaining how they have benefited from using me or why they do. This can be found on the testimonial section of the website. I don’t edit these, hence a few typo’s. Beyond this, I ask clients if they have benefited and when they become aware of someone who they think may “fit” perhaps I may be able to help them too. If I’m honest, I find this rather awkward and whilst I’ve had many advise me not to be so daft / shy stating that if I’m doing something that people find to be of genuine benefit, why wouldn’t they want to recommend me? The thing is that people need reminding. I’m not so sure. Financial planning is a bit of a taboo subject and many people struggle with their relationship with money, it’s often only at a moment of crisis that people talk or after an event – the market crashing. Financial planning can be liberating and something of an epiphany moment when done properly. However, sometimes it isn’t always good news, which of course is often what is suspected, hence the natural inclination to avoid facing uncomfortable truths.

Any bright ideas from you?

So if you have any bright ideas about how I might help more people I’d be interested to hear from you. Providing an incentive is always an option, though it does lead to more questions about motivation. For example, if you go to eSpares and use this code: LXY0XW3E I will get a £5 voucher for my next purchase from them… something in it for me, but really, am I likely to use the voucher?

Referring The Right ClientsDominic2023-12-01T12:22:42+00:00

FSA RDR Consumer Guidance

1968: The High Commissioner – Thomas

FSA RDR Consumer Guidance

Today has seen an update to FSA RDR consumer guidance, which is information to the general public about the Retail Distribution Review (RDR). This can be found within the FSA website. This is meant to explain the changes that will effect all UK investors from January 2013.

RDR – Keeping it too simple

The 6 page pdf booklet is the FSA RDR consumer guidance and is brief, frankly I’m left wondering how on earth something that appears to be so simple has cost the financial services industry millions to adapt and prepare for. In short, we have reverted back to a “not quite” polarised industry – with “restricted” advisers and “independent” advisers. The definitions of each are still far from clear. I would also argue that the issue of how advice is paid for has been really poorly handled, though this is in part due to the vast number of computer systems with different approaches to the same fundamental problems. My stance has always been to be clear about the charges that we apply and to have these on a fee basis, so that they can be agreed and are not open to manipulation by advisers or product providers. Sadly I do not believe that this document conveys the issues well enough, rather “downplaying” the significance. Most people will not be able to afford financial planning because this process was started too late and made the fundamental mistake of banning commission. This is not an issue for our clients, but it is for millions of people who have been under the impression that their adviser works for free and occassionally collects a bit of commission. The FSA are aware of this problem, hence the links to the Money Advice Service, which indicates the advent of the online DIY approach that most will believe to be the only option…after all we can’t trust the banks can we?

FSA RDR Consumer GuidanceDominic2023-12-01T12:22:42+00:00

Clegg’s “Emergency Wealth Tax”

2010: Fair Game – Liman

The media is full of stories that Nick Clegg is about to suggest an emergency wealth tax. The proposals seem to focus on taxing wealth rather than income. He will be outlining his thoughts next month at the LibDem annual conference (not that urgent then!). It is difficult to remain even handed when politicians come out with headline grabbing statements. Mr Clegg, as we all know has somewhat lost the shine that surrounded him during the last election, though quite how fair an assessment this really is remains to be seen. I have to admit that I tend to be pretty sceptical of most politicians, but in particular the three party leaders. All of whom purport to have “family values” yet applied for jobs whilst they have young families that would certainly require longer working hours than most of us would contemplate, removing the ego from a career is not an easy task, in politics it appears particularly difficult.

Returning to the issue at hand, a fair tax system is relative to what you believe “fair” to be. One could take the view that fair, would be everyone having the same and therefore paying the same tax, or simply a fixed sum. Alternatively fair might be paying the same proportion of income as tax (rather than the multitude of different rates of tax on different forms of income). As I have said before, there is needless complexity in the UK tax system. As a financial planner I am duty bound to help reduce tax payments, which we accept is not the same as “tax dodging”, because deep within us, we are probably of the view that our taxes are not spent wisely, much is wasted and we should be paying a lot less. The problem as I have said before is that there is an incentive to arrange your affairs in a manner that results in as little tax being paid as possible. This is true of the self-employed nanny to the large multinational. This is daft, but nobody (no politician) wants to address this basic problem. Instead they focus on how taxes will be spent (or not) and shifting the rates of tax by millimetres once a year.

There is no doubt in my mind that the system does not work well. The really wealthy tend to pay very small amounts of tax, whereas those earning between £100,000-£1m pay huge amounts of tax proportionally. I don’t profess to have all of the answers on this, except that I do firmly believe that a single rate of tax applied to all forms of income, however they are derived, would make much more sense and would be an awful lot fairer. Wouldn’t it be better to live in a country where we all felt a sense of fairness and perhaps joy in paying our taxes that contribute to the society in which we want to live…. I know, I must be dreaming.

We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting

Clegg’s “Emergency Wealth Tax”Dominic2023-12-01T12:22:41+00:00

Golden Polish Lessons

1912: Gold and Glitter

What can the Polish teach us? Well quite a lot I’m sure (as can every culture). However, I’m referring to the current Amber Gold financial scandal that has rocked Poland. Long story short, lots of people invested lots of their money into a fund that appears to have invested into a single asset class – gold. As if that weren’t bad enough in itself (all your eggs in one basket) then matters seem to have been compounded by the fact that this was in fact a scam, another pyramid ponzi scheme, whereby the new invested money was used to pay out the original investors. This apparently fooled investors into believing that the scheme “worked” and that the double digit returns were as marketed “guaranteed”.

As some of the media rush to chastise the Polish for their lack of regulation, financial education etc, I cannot help but point out that “there but for the grace of God…” (and by this I am not implying that we are somehow “blessed” and other nations are not…) what I mean is that, put simply, we can all fall for this trap and frankly many do on a daily basis, its simply that the scam is a little better hidden.

These sort of financial products play into people’s fears about the uncertainty of investing, offering “guarantees” and suggesting that they are nothing to do with the stockmarket. To their huge credit the Polish regulator black-listed Amber Gold almost from its outset, but lacked the clout to close the company. I know several Polish people and am always struck by how hard they work. I mustn’t get into sweeping generalisms, but suffice to say I like Polish people.

So what can we learn? be very wary of anything that promises a guarantee. The only guarantee in life is death – and some would say that even that certainty is open to interpretation. It used to be said that there are only two certainties – death and taxes. We know the latter is not at all certain. Don’t put all your investments into one asset class (shares, property, gold, commodities, cash) history has taught the wisdom of diversification and those that suggest otherwise are not typical investors, but gamblers. As for the criminals like Marcin Plichta, one can only hope that justice will eventually prevail. As for the rest of us, well be guarded against believing what you want to believe and make sure that a proper assessment is conducted and don’t forget that a criminal rarely looks like a masked man carrying a bag with “swag” written on it. I cannot guarantee the translation, but try this in a translation site: wszystko, co się świeci, nie jest złotem.

We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting

Golden Polish LessonsDominic2023-12-01T12:22:40+00:00

Deceit Is Hiding In Plain Sight

1994: True Lies – Cameron

I do recognise the problems that the regulator has. The difficulty for investors or the public at large is to understand what game they are playing – sometimes it really is not clear. Take Saga for example. They have been criticised for sending mixed messages. On the one hand they have been advocating shopping around for a better annuity, using an open market option, yet on the other they have a marketing arrangement to offer Legal and General annuities. Which? have cited this double standard and of course Saga have put their PR machine to work.

Annuities are a “problem area”. Most people don’t have very big pension funds so the scale of the problem may not be fully known. However many people simply opt for what their employer or pension provider offer as an annuity. A proper review of all of your pensions together with a proper assessment of your required income for the remainder of your life is pretty vital when making an often irreversible decision about which annuity to pick. I’m often perplexed at how many companies (big ones) get away with a very reckless approach to these sort of decisions – bar of course the “catch all” disclaimer form that excuses them from any responsibility.

We have been doing some work for a client on this and were surprised to find that the employer’s own annuity was better than anything we could find. This has never happened to me before. So my advice was to go with the better option offered by the employer (because my job is to secure the best deal for the client). However we weren’t informed of an error that the employer had made (an honest one) which we hadn’t made, (our figures were right) this made a significant difference and resulted in the best deal that we secured being 6% better each month for life. So the client has now been able to “switch horses” to get the best possible deal.

Frankly, there was a degree of luck that this was caught, for many hundreds or thousands of people out there, they don’t get a second chance with their financial planning. The jargon is often baffling and I’m sorry to say that I find little to suggest that this is not deliberate. The big scandal in financial planning is not the charges on pensions or PPI but on the deliberate mis-information spewing from the marketing departments of large organisations that is taken at face value. This is not restricted to more complex elements of financial products but even on the very simple ones, such as “guaranteed bonds” that are taken out in conjunction with an investment. Sorry, but this is not good enough and people are being ripped off.

We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting

Deceit Is Hiding In Plain SightDominic2023-12-01T12:22:40+00:00

Bank Holiday Cash ISA Rates

2007: Mr Bean’s Holiday – Bendelack

Banks continue to remain in the news. Santander are chancing their arm by increasing their standard variable rate by 0.50% for their mortgage customers. I can see no good reason for this with the base rate being so low – perhaps they had to pay out rather more than expected with their Rory McIlroy bonus as he won the US Open last week. There has been much press coverage about whether a free bank account is really free and indeed even one that is always in credit still isn’t really “free”. I’ve blogged about this before and so won’t cover the same ground here.

Since I last updated you with some of the top rates, there have been quite a few changes. So here is a more up to date list of some of the top rates available. Remember this is not advice, just a list. If you are a client and want advice about accounts please get in touch, if you aren’t then either get in touch to see if there is mileage in working together or otherwise please ensure that you do your own research and always remember that the FSCS only cover up to £85,000 per person per Bank – and that is really per Banking License (some banks share a license). In the event of collapse, you are only covered for £85,000.

Instant Access Accounts

Online: Saffron Building Society 2.76%

Bank: Virgin Money 2.60%

Building Society: Newcastle 2.60%

Cash ISA – Fixed Rate

Online: Bank of Cyprus UK 3.50% (3 year fixed)

Bank: Halifax 4.00% (5 year fixed)

Building Society: Kent Reliance 3.75% (5 year fixed)

Cash ISA – Variable Rate

Online: Aldermore 3.15% (60 day notice)

Bank: Virgin Money 2.85%

Building Society: Kent Reliance 3.51% (2 year tracker)

I would like to underline that this is not advice in any way. There are many aspects to selecting a deposit account besides the headline rate, the financial security of the institution, its ethos and general customer service to name just a few issues – also a local physical branch is important to some people. Anyway I hope that this helps. Enjoy your Bank Holiday weekend, after the banking scandals of money laundering, systems failures, LIBOR and charging for accounts, I imagine that many retail bankers will be looking forward to the day off.

We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting

Bank Holiday Cash ISA RatesDominic2023-12-01T12:22:39+00:00

Beware of “Do It Yourself” Lessons from Spain

1929: Painted Faces – Rogell

The Bank Holiday weekend approaches and many will be hoping that the traditional BBQ in the rain will be avoided this weekend. Many will also take advantage of the additional day to attempt some of those awkward jobs around the home with thousands making trips to DIY stores across Britain. Putting up your own shelves is one thing, but even in these more challenging times, it is worth remembering that if the job is beyond your current ability and is important, it is worth seeking someone that is proficient in the relevant task. D-I-Y is for many a pleasure, for others it is a perceived way of saving money. When it comes to financial planning there are those that spend time to save money (DIY) and those that spend money to save time (our clients). A key factor is the complexity of your financial planning and your ability to know how to navigate the industry. Clearly I don’t work with people that want DIY financial planning, not that they aren’t bright enough, they simply value their time and want to focus on things that they are good at or enjoy doing. Its also the case that I “carry the can” as the one responsible for the advice.

So it perhaps a timely reminder in today’s news of the pitfalls of attempting those “irritating little jobs” with the best of intentions, but lacking the relevant skills. A parishioner in her 80’s was concerned about the deterioration of a fresco of Jesus at her local church near Zaragoza and decided that enough was enough and that she would attempt to repair the painting “Ecce Homo” by Elias Garcia Martinez. The result has caused considerable bewilderment and presumably significant cost to correct. Whilst I am sure most would not have even attempted this DIY job, it does prompt the question about whether we are really aware of how limited some of our own skills are and how long it takes to become accomplished in them. This story has of course caused much attention across the internet, but perhaps it is worth seeing as a lesson from Spain, that skills are learned over many years.

We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting

Beware of “Do It Yourself” Lessons from SpainDominic2023-12-01T12:22:39+00:00

Fairly Sensible Approach: UCIS on the ropes?

2007: On A Tightrope – Lom

Whilst I have many concerns about how the financial services industry is regulated and promoted, I have no illusions about how difficult a task this is for the regulator, the FSA. I have a significant amount of sympathy for them as they attempt to separate the wheat from the chaff and prevent the two being mixed or confused by the general public.

Today the FSA announced that it is considering changing their rules in relation to UCIS (Unregulated Collective Investment Schemes). You would think that this is straight-forward enough, after all, the tell-tale feature is in the very first word of the product name. However, its a little more complex and as with most things, not every UCIS product is “bad”. The RDR changes from 2013 means that to be classified as an Independent Financial Adviser, the adviser firm has to be able to assess and arrange UCIS products. This has given many of us some concerns, as this is a highly specialised field and one that is easy to get very wrong. The FSA themselves, would not expect that UCIS is appropriate for more than 2-3% of the population.

Recent scandals, that have resulted in many firms becoming insolvent and threatening the access to professional indemnity insurance resulting in much higher costs for those that know what they are doing. This has given IFAs serious cause to consider not being independent from 2013. So today’s news is probably welcome and I await to see the detail of the Consultation Paper. It should mean that there will be fewer advisers thinking that they need to arrange the odd UCIS without doing any proper research. UCIS products can be very complex or they can be realtively simple. However, assessing them can feel more like being a business angel from Dragons Den than a financial planner. However, the FSA need to tread with care so that they do not become “product approvers” resulting in reduced innovation. However, I am more than willing to concede that in this instance, the greater good is served by preventing access to products where both investor and adviser can lose it all.

I’m not a huge fan of UCIS, partly because I receive loads of emails from promoters which have the hallmarks of disaster – offering “guaranteed returns” and “high commission”, I have my own name for them, Unique Commission Incentive Scam.

We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting

Fairly Sensible Approach: UCIS on the ropes?Dominic2023-12-01T12:22:38+00:00

Successfully Failing? or Edited Highlights?

1958: Les Bijoutiers du clair de lune – Vadim

As I was on my way to work this morning, I was reminded that today is “D-Day” – Debussy day. He would be 150 years old today (born 22nd August 1862). Those that know his story will find a familiarity with that of many other “passionate artists”. I don’t want to compare the impact or quality of the work, but it is perhaps surprising that we are still “shocked” or “surprised” when current “artists” find their lives in turmoil. Our celebrity obsessed culture is full of stories that often suggest a deep unhappiness with life and the social conventions of the day. Debussy was from a very poor background and began piano lessons at the age of 7, by the time he was 18 he was showing considerable promise and was assisted by a Russian patroness Nadezha von Meck.

As with most historical figures, we are left with the edited highlights, the great moments or works, a legacy. Clair de Lune is perhaps Debussy’s most popular or well-known piece. It is believed to be inspired his love for Blanche Vasnier, a married woman with whom it is understood he had a long-term affair. It would be fair to say that he had a colourful personal life and living up to many of the stereotypes of passionate French male artists.

Debussy was diagnosed with cancer at the age of 47 and was one of the first people to undergo a colostomy operation. He died as a result of the cancer, but at the same time, the German army was bombing Paris, where he was living at the time. He was 55 when he died.

One of the great advantages of time is the ability to edit. This reminds me of the Olympics and many of the comments that I heard or read. I have no desire to undermine the significance of the achievements British athletes made, but spare a thought for those that did not make the team, either by a fraction of time or due to injury. Suggesting that a gold medal can be reduced to 4 years of hard work and the right funding is not terribly accurate, as many have access to the same resources and apply the same amount of training. A degree of luck or good fortune is required, timing is everything. It is not the case that whoever trains best wins, there are certainly similarities between those that “win” and focus is often cited as a key aspect of a winning mentality. Our media has a tendency to forget the daily struggles, (ok they will probably compensate for this with the Para-Olympics) yet it is the struggle that invariably produces the result, as Debussy’s life seems to typify. This applies to art, sport, economics and financial planning (and most aspects of life) achievement comes from pain and struggle, failure is the route to success.

We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting

Successfully Failing? or Edited Highlights?Dominic2023-12-01T12:22:37+00:00

Elite Financial Planning

2007: Elite Squad – Jose Padhila

Financial planning and the Retail Distribution Review are under scrutiny again. Today a letter in the Financial Times but Conservative peer Lord Howard Flight is highly critical of the regulator and RDR. He believes that the new rules being introduced by the FSA will mean that most people will no longer receive financial advice, except those with savings over £100,000. This is not a new point of view, indeed the vast majority of advisers cannot afford to provide advice going forward to most of their commission based clients. This is not an issue for our clients, who have always paid us fees for the work that we do. Our clients are admittedly a bright bunch and able to recognise the value of good financial planning and understand that there is no such thing as a free lunch.

Delusion that financial planning costs nothing or very little is a national condition. Frankly I don’t believe that the regulator really appreciates how expensive it is to provide. JP Morgan, who have been doing a fair bit of work on fees for the last couple of years have today published a report suggesting that only 13% of consumers are interested in seeking out ongoing fee-based advice. It wasn’t an enormous survey (2,028) and most will know my lack of regard for surveys, but this was one aimed at higher rate taxpayers. This is concerning as in general I suspect that the regulator was happy that those paying little or no tax could be adequately helped with low cost products that they can source themselves or employer arrangements. This survey suggests that even the more affluent are struggling to understand the value of financial planning advice.

To my mind this suggests that collectively as financial advisers, we have failed to educate people on the benefit of financial planning. Indeed it is evident from the reckless handling of national finances, that most world leaders and politicians also do not understand some of the basic principles. Thankfully I am not tasked with saving the world, but in helping clients that want proper financial planning. Our clients are elite, because they are amongst the small group that “get it”. So as we celebrated our 13th birthday a few days ago, I am please that at least our clients are getting great value for money and understanding the value of money.

We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting

Elite Financial PlanningDominic2023-12-01T12:22:37+00:00