Adviser rejects AIFA over 'pandering' to 'GCSE-level' IFAs

GCSE's for AIFA members

It is dissapointing that AIFA should promote GCSE's for their advisers - until you recognise they need to include Bank Managers ( or monkeys ) as they are now trained. A bank manager with a GCSE would be an improvement on the reduced quality of bank and building society employees now paid to generate sales with the most awful knowledge - less sales skills, appalling customers service - by these tied agents.

Posted by: Ian Lees

Well Done Steve!

Well done Steve on your wise words. In my opinion, AIFA beleives that it represents the voice of the IFA and this is simply not the case for all. What was the point in going through all the exams and converting to a fee based model when others are pushing to brush this aside. Again, well done for your comments and when are we, as a collective fee based/qualified group going to start an organisation to have the full picture represented. Keith Churchouse Surrey Cynic

Posted by: Keith Churchouse

IFAs qualifications

I am amased someone coulfd possible call an IFA with the basic FPC qualification 'GCSE' level! Even if an IFA didn't have that qualification it would be no judgment on being able to give honest and appropriate advice! These IFAs who have drummed up societies to promote their own agendas for qualifications are no better. Passing an exam will not make an IFA a better adviser. Commission is and always has been a client friendly way to allow advisers to be paid for the work they do. If the amounts paid are considered too great then apply maximum levels. Fee based IFAs are not a better class of adviser just those who like to hide behind fees and call themselves 'members of a profession'. ewell, let me put them right. Being a member of a profession and carrying out a job professionally are two different meanings! AIFA, give me a call if I can help! There must be a job out there for me mentoring all those highly qualified new IFAs as to the best way to do the job!

Posted by: Derek Vivian

Stick to Comedy

I think he should stick to comedy ..... It's Complicated for a man with Two Brains! I support Chris for supporting us thickies.........

Posted by: Eric Shun

Pandering to whom?

Who is this guy pandering to? Himself probably. Has he not realised since regulations and examinations were introduced we have a less educated public when it comes to long term savings and a decimated pension sector. Let me remind you pre 1997 we had the best funded private pensions in the world. Were you born then? The likes of this man is there to look after himslef as he knows little about reality in the front line of advising. Why doesn't he just go and join the FSA as they are looking to recruit 460 new monkeys over the next 1/2 years. Posted by IFA for 30 years

Posted by: Incompetent Regulators Awards Team

Qualifications

There is no one in the industry complaining about the increased level of qualification what they are complaining about is that it is retrospective. I have been in the industry over 25 years and I have had to qualify four times to remain in a position. What needs to happen is the new standards should be set for new entrants. It is easy for a consultant to train when his career is in front of him but when your career is behind you then studying for new exams are difficult. I now have to inform my clients that the advice they received from me over the years was not up to standard as I was not qualified enough. Why someone who charges a fee sees himself as professional is beyond me surely we have been disclosing our income to our clients for years. Whether the contract is charged or the client the most important thing is that they get advice. We are going about it all wrong and falling into the hands of the banks who have provided the worst advice for years just see the complaint history. If it's not broken why try and fix it surely there are more important things to get on with. My last point, the FSA should be disbanded as they cost the industry and government too much money. Better spent elsewhere.

Posted by: Stephen Pollard

Sciolism becomes you

In case your exhalted education does not provide you with an understanding of the word SCIOLISM I will assist. It means - "one who has conceit, based upon fancied knowledge" and it is best applied to those who espouse their own superiority and attempt to claim superior knowledge solely evidenced by spurious letters after their names. Passing an exam does not make you a good adviser - any more than NOT passing an exam makes you a bad one -- I have over 42 years experience in financial planning and will bow to no-one who believes he is somehow superior. I have no GCSE's - they did not exist when i was cutting my teeth on CII exams which were wholly irrelevant to financial planning. But I was required to take them. I was offered a Fellowship of the LIA for a few pieces of silver when that organisation was founded (I declined). I was offered Fellowship of the PMI when that organisation was set up (I declined. I now see no justification for enforced retirement just because some jumped up exam junky wants to eliminate the competition from quality experienced IFAs. Now i must close before my blood finally boils over

Posted by: GROSVENOR

Some humility would be nice!

As a Chartered Financial Planner and Fellow of the PFS it is disappointing to note the lack of humility and understanding being demonstrated here. The RDR holds no fear for me, but I have some sympathy for my peers who cannot yet say the same. I also understand that AIFA have a duty to represent the adviser population and, therefore, it would be surprising if they wholeheartedly embraced something which is likely to decimate the number of practicing advisers in this country.

Posted by: The Dark Horse

Self Promotion

Whilst there is some small validity in what he says this smacks of yet more 'self promotion' via an open letter. This is nothing more than a blatent advert for his firm and new mini network

Posted by: Anon

Whats in a name?

Steve Martin is a comedian that is no longer funny and very short sighted. 'One business model for all' is not practical given the diversity of product areas being advised upon and the different types of clients being dealt with. It is generally accepted that 50% of IFA's may be unable or unwilling to continue and with rising FSA fees as a disproportionate burden already, Martin should be careful what he wishes for or he might be the next one to feel like he is being driven out of business! AIFA are a voice for the average adviser not for the 5% of businesses that are compatable with the RDR model. I would ask you to try to remember past enterprises that thought they were being progressive - and progressed Smartly out of existance!

Posted by: Lawrence Brennan

cheap publicity

This sort of argument is as tedious as the commission vs. fees debate. I have met some 'highly qualified' advisers in the past that I would not trust with my children’s pocket money. The problem is this industry is stuffed full of salesmen who act as advisers to sell products. It makes no difference if they are highly qualified or not they will still sell products and put client needs secondary. In fact the higher qualified the more unscrupulous the better they will become at ripping clients off. The qualifications are not the problem with this industry; it is the ethics and the culture. Obviously Steve Martin from Smart Financial Planning does not recognise this, but sees the fact that as he is highly qualified it is a way of promoting his firm and gaining more publicity! Fair play. I wait for the next instalment, perhaps a revisit to the commission vs. fees debate?

Posted by: Nigel Tinsdale

SmartArse Financial Advisers

Steve you are displaying open age discrimination towards many older advisers who have proved their competence and technical ability so often in the past during a long career which has stood the test of time for much longer than your own. Did you know that someone who became a Fellow of the Institute of Bankers or of the Chartered Insurance Institute in the 1960's has qualifications which are null and void as far as the FSA is concerned? Subsequent passes in examinations are now worthless too as I have been advised that any exam passes more than 15 years old won't rank towards the new benchmark. What a racket! The best way for any adviser to develop professionalism is through continuing practice and regular CPD. This applies to any profession. Exams are certainly useful, but in themselves simply prove that you could tune your brain into the facts and theoretically recall and apply them to some extent, within the confines of an exam room at some point in your life. But as you get older (and even more professional) your powers of recall in the exam room diminish! Well done in passing some industry examinations, but please stop massaging your ego and bolstering your status just because you've got a few certificates. You are free to decide that people must pay you a fee for your advice. Good for some clients. But don't forget that many older advisers will continue to do things without a fee for many of their (older) clients, just as they have done for years. It would be treacherous to dump them, at this time of life it's much more enjoyable to be a go-giver rather than a go-getter, and our clients have nearly all become friends anyway. And there's nothing wrong with a business model where the more profitable clients subsidise the less well off. It actually applies to most businesses and it's a form of social justice. So please stop worshipping at the shrine of a fee based model and start to think how you can become a really useful ornament to society within the community in which you operate. Otherwise people will form the view that you are too smart for your own good. And that's a bad name to get, no matter how many exams you passed.

Posted by: Paul Terry

Problems oh problems!

I am a "highly qualified" IFA who happens to be MD of a company with 11 advisers. Some of my advisers will struggle to meet the target set by the FSA. Others are already there. When I assess their skills as advisers the qualifications do not enter into it. Our transition to fees is, well, interesting! Nigel Tinsdale summed it up well-ethics and culture are the key issues-not individual business models dictated through historical growth or the nature of your client bank. Some fee based IFAs seem to overcharge their clients as do some commission based advisers. Others seem to work for very little reward and put their clients before their own profits! Let the industry concentrate on client outcomes rather than the business models used to obatin those outcomes. Then perhaps these rather futile arguements can be put to rest, with our efforts being pooled to improve ethics and business culture.

Posted by: Ken Hayden

here we go again

No wonder the fSA think they have got IFAs on the run. Instead of backbiting and some wanting to feel superior to others why the heck can we not all stick together as an industry(or profession if you want to be snobby). We should be responding together. Do those that follow the mantra of the FSA feel they will get a better deal from them on a compliance visit, if they do watch this space.

Posted by: terry arch

RDR

As far as the qualifications are concerned, I find them daunting. This is not because of my intelligence (I have a law degree) but because of the time it will consume to study - especially when trying to run a large client bank. RDR seems to be playing into the bank's hands - where will the clients who refuse to pay a fee go to get advice?

Posted by: Falkirk IFA

Twaddle

Self serving elitist arrogance Sums it up doesn't it

Posted by: Common Sence IFA

Who'se a clever boy, then?

So you recon you’re a cracker do you Steve? So what level do you think CFP is? I’m a CFP and it is (as far as I am aware) no better than Level 4 – so what are you crowing about? I judge that you are in your 30’s – if so I was taking qualifications (and not only in Financial Services) while you were still in your pram – indeed probably before your Dad met your Mum. I can tell you that although qualifications might be a ‘nice to have’ they don’t automatically make you either a good or competent adviser. So how about getting off your high horse? As it is said “Pride cometh before a fall” and being critical of an organisation that does so much good in so many directions is churlish and indeed you are probable a free loader benefiting from some of the work that AIFA does. (Adviser fees, parliamentary lobbying, regulatory oversight both with re FSA and Europe, intermediation with the FOS and FSCS and goodness knows what else). There is no such thing as an organisation which is perfect and with whose policies we can agree entirely without demur. One takes an overview - if you’re going to be mature about it. Outbursts such as yours do exactly the opposite to that which I’m sure you intended.

Posted by: Harry Katz

Not a member then?

In order to take a pot shot at a representative body the first requirement must be membership of something other than your own fan club, Mr Hargreaves (can't remember his first name) of Hargreaves Lansdown is one such case in point, lots of opinions which are loud but quite solitary. I hereby challenge this man (can't remember his name right now but the people above are calling him Steve) to allow me to take a peek at all his (or his network's) files to see if I can find something the FSA might take an interest in. In fact I challenge anybody who shares his rather narrow minded approach to financial services.

Posted by: Evan Owen

Gosh, that seemed to get you all going!

Evan, I struggle to understand your rational that, 'In order to take a pot shot at a representative body the first requirement must be membership...' I am highly critical of the BNP, should I cease to be until I become a member? I guess criticism of one organisation purporting to represent IFAs was a little close to the bone and you thought you would jump in in-case you were next in the firing line. Harry, the IFP are seeking the CFP to be accredited at level 6 not 4. As to your general point, I will complete the CII’s chartered status in the next few months to add to the CFP and the IMC, all of which is done for the benefit of my business and clients and not because the regulator has decided that is a requirement. Next year I will probably start on the Masters in Financial Planning that Manchester Met is now offering. Does that make me a ‘clever boy or a cracker’? No, but it gives me a lot of experience of the benefits that my clients and my business gain as a result of my continuing professional development. Finally, my objective is not to look down upon those who are working their socks off trying to get to a higher level of qualification, far from it. It is to draw attention to the retrograde position AIFA and many of its members have taken and shame it into re-evaluating its position and, perish the thought, provide support, training, guidance funding etc to help advisers gain the skills that the FSA and the consumer panel believe they need to do their job properly and to reduce consumer detriment.

Posted by: Steve Martin

Servicing clients

Many of the intermediaries who do not wish to jump through any more hoops in order to continue servicing their clients, are too old to have had to take a reduced standard GCSE. They had to take a much harder GCE. It's only younger people who couldn't hack GCEs that had to be pandered to and given a GCSE in case they felt discriminated against by elitism. Now, because they have a paper qualification, that 60 and 70 year olds don't have the mental capacity or desire to take, the younger IFAs see a wonderful way of taking the clients of the older IFAs away from them. The clients however are on the losing end because they can no longer receive advice from the person with whom they have dealt for the last 20, 30 or 40 years.

Posted by: David May

Fantasy Island

I have been a Partner in my samll firm of IFAs now for 21 years. Never lost a client, deal with client from start to finish (do all our own admin), get many a referral from existing clients (and we don't ask for them!). I assume all our clients are, therefore, happy - it certainly seems so from the customer satisfaction questionnaires we send out as part of our TCF. Running a business, looking after staff matters, business accounts, being compliance officer, TCF champion, Money Laundering Officer, PI negotiator, data protection officer, etc etc etc. All this doesn't leave much time to study for exams because, believe it or not, I still need to earn money to keep my business running and pay the staff. I assume you are living on Fantasy Island because you are certainly not living in the real world. Maybe you should become a lecturer in Financial Services at Fantasy Island University because that seems to be all you want to do - spend your time studying ! I would love to gain additional qualifications but only in my own time, at my own pace, and on a continuous assessment basis. Unlike you I do not get a kick out of sitting exams. Anyway, that's enough of my gripe. I hope you get the picture. Got to go now something's coming......de plane de plane! (that's just something for Fantasy Island fans and to prove I haven't lost my sense of humour!)

Posted by: J.Georgiou

PPP

"Gosh, that seemed to get you all going!" You patronising pompous pratt. It's hard not to be personal when you see the comments of people such as yourself, the Bamford duo, Andrew Fisher and Peter McGahan to name some of the more prominent ones. They, and others, serve the more elite type of client and seem to hold the opinion that any other clients that are unable or willing to fit their business model should go without financial advice. Your IFA Online "Profile" states: "the Chartered and Certified financial planner has seen assets under management triple to £25m and he has taken on 12 new clients." Now I'm no mathematician but that would suggest each new client is worth circa £2million each. If you think that this represents the client base of the average IFA in this country then he's deluded and not living in the real world. Good luck to you Steve, these people obviously need servicing, but so do the millions of other normal people in this country who do not need or can afford such advice and require the "easy terms" of the commission option, even if it costs them more in the long term - and that opionion is offered by me not as an adviser but as a consumer. If a fee is needed for advice relating to non-commission paying products then so be it but this is no justification for the removal of commission as a payment option for clients across the board. As has been pointed out (and ignored by the FSA) many times, leveling of commission for any given product is all that is required. I'm afraid that the likes of yourself are far too arrogant for your own good. You obviously have a good business but yourself and others in a similar position seem to enjoy the opportunity to try and laud it over the more oridinary adviser in this country by offering up your inflated ego in public with what YOU see as some sort of thought provoking article thinking it will make us lesser mortals see the light and the error of our ways and realise that shining examples of perfection such as yourself are the people that we should aspire to emulate and that "we" have all been doing it wrong for all these years. So many "news articles" these days are nothing more than the views of opinionated self serving buffoons with nothing of real substance to say apart from how wonderful they think they are. I guess you will have to do the "less sophisticated, lower earning work" yourself instead of fielding it out to what you obviously think is a lower class adviser, should that adviser not cut the mustard with regards to qualifications in 2013. People are sick of the FSA's overregulation, overcharging and destruction of what is a very helpful industry in the main. It is my opinion that the likes of yourself, the Bamfords, Fisher and McGahan do not serve the average Joe in this country that needs traditional financial advice and that your opinions are nothing more than the pompous drivel of "industry commentators" out to serve their own agenda and not the general public at all.

Posted by: Martin Lewis

Qualifications

I have to say that I agree with Steve. The reason is that I came from Engineering to Fianacial Services in 1979 and in Engineering it is part of apprenticeships that you go to college, now, that was in 1960. Here we seem to have an indsutry that wants and needs to be taken seriously and yet we fight about raising standards. Apart from the fact that the more you know the more you keep clients, knowledge is a very powerful tool. I feel sure that AIFA would want to promote better qualified people Roger Holloway

Posted by: roger holloway

.

So, imagine you've been an Engineer for 20-30 years, got lots of experience, really good at what you do, then someone tells you that, despite your qualifications and knowledge being good enough to earn a living for the last 20-30 years, unless you pass these new, higher level exams, to prove your competence yet again, you will no longer be able to work as an Engineer.........

Posted by: Martin Lewis

Good luck for the future steve

Should the regulatory body in control in say 25 or 30 years time decide adviser qualification should be raised to level 199 or whatever arbitrary figure it sticks a pin in, I hope you feel the same way Steve. Given that you will have been in business (hopefully) for years by then and will assume you know pretty much all you need to know to service your client bank, I hope you will have enough time out of your busy schedule to start studying in order to qualify to do the job you have been doing successfully most of your working life.All the best.

Posted by: LOL

Icarus learnt the hard way

Yes, Mr Martin, it is not very nice when one is vilified over views expressed - but what did you expect? I agree with most of the comments posted in their objection and indignation. It is not that I, or others, are opposed to our business trying to up standards. Quite the contrary in fact. I subscribe to higher qualification levels - but for new entrants and transgressors. Insisting on higher qualifications for experienced advisers and banning of commission etc will not achieve RDR aims. Or, rather the problems cited by the FSA as the root causes for the whole rationale for RDR, which, are old chestnuts now and in any case are simply not proven - particularly where IFAs are concerned. The public will certainly not all suddenly clamour for advice, chequebooks at the ready, because of RDR. What an unholy waste of time, effort and money! Good advisers are ones who can demonstrate that they provide sound advice (in their required field - not every last financial service aspect), are moral, and have not had complaints. These people should be left alone - particularly if they are of more mature years. The possibility that someone's livelihood could be taken away when they have done nothing wrong is shocking and those that are facilitating this potential course should be ashamed of themselves. So, the highly qualified and fee based Mr Martin is apparently now nearly at the pinnacle of excellence in financial service terms (I say nearly because there seem to be a few more bits of paper to be aimed for). If this is the case, perhaps the FSA would care to pay his business a visit - just to make sure that all is well! In the meantime, the rest of us less cerebral folks will have to muddle along the best we can - a constant threat to the public - or not.

Posted by: Robin Hood

Thank you, Martin Lewis

How lovely to get dragged into this debate by Martin Lewis; someone who clearly knows very little about my business and chooses to read my opinions in the trade press 'selectively' at best. Can I invite Mr Lewis to give me a call so I can explain about the diverse nature of our client base, and how we want to ensure every segment of society of served (and the steps we have already taken to provide affordable services to lower socio-economic groups). I'm sure that once he gets to know me, he will quickly appreciate his views (as described above) are completely misguided and formed as a result of his own inherent biases not anything we have actually said or done. Back to the original focus of this article, I cannot imagine any IFA would argue for lower standards of professional education, assuming this is relevant and combined with relevant experience. As we have always said, it is the combination of these factors, along with an ethical standard of behaviour, that makes for a truly professional adviser - not exams in isolation.

Posted by: Martin Bamford

.

Martin I'm sure nobody is against the general raising of standards via exams, CPD, training or otherwise. It's simply the retrospective nature being applied to experienced advisers of many years standing and the threat of people's livelihoods being pulled from under their feet should they not be in a position to meet the FSAs deadlines for the RDR requirements. This brings massive pressure to bear and to suggest that anyone who cannot cut the mustard should simply be tossed out of the industry, as many of the pro-RDR advisers seem to insinuate as a course of action, is perverse. It's no co-incidence that only occasionally does the odd comment on the online forums buck the consensus of opinion with regards RDR issues and they always seem to come from the same type of firms that have a vested interest in other advisers being forced out of business should they not comply with the forced examination and FSA deadline. The average IFA is sick to death of it all and so you'll have to forgive me for generalising and throwing a few of the more prominent advocates of the RDR into the same hat regards my earlier comments. Maybe if you find yourself in the same boat one day you might not appear to be so upity about the matter.

Posted by: Martin Lewis

Reply to Steve Martin

Apart from all your wonderful financial expertise I would suggest that you first enrol in an English Grammar class – it is rationale (with an E). One is an adjective the other a noun. You should know which is which. As to be rational I didn’t see anything from you regarding your solvency or the fact that you put your money where your mouth is. Before you become a critic be sure of your ground. There were those who were qualified light years in excess of even your wildest aspirations – Nobel Laureates. They almost brought the global financial system crashing – ever heard of Long Term Capital Management? Then of course I shouldn’t have to remind you of the highly educated clever clogs at Lehman Bros – et al. It seems there is a general consensus regarding your post and can be encapsulated in two words – Pipe down. (That is not to say that I condone so of the more downright rude and impolite comments). So you recon we CFP holders will be judged at Level 6 – oh boy! I think I’ll go and hang out the washing! What difference will that make to me or my clients? I took this qualification voluntarily as I did all my post higher education qualifications. It was for my benefit. I would guess it takes more than a study course to benefit my clients.

Posted by: Harry Katz

Commission In All But Name

It does amuse me when these so called "fee-only" advisers have a go at the commission hungry, low qualified, GCSE level salesman (which I guess I must be, as I offer the choice of fee or commission). Having a quick look at Smart's website, we can see that they only take on new clients who have or are approaching £500k assets (excluding property) and charge a percentage of these assets as a fee. Given that the definition of commission is "a fee for services rendered based on a percentage of an amount received or collected or agreed to be paid" then they do get paid via commission, albeit not via the provider. A closer look at the fees (commission) involved shows us that there is a Plan Fee of 1% of all assets (excluding property) - it looks like this is paid whether or not the client goes ahead with anything. Then there is an Implementation Fee of 1% (of the amount invested) and £500 per protection policy. And finally every year a 1% Annual Fee, commonly known as trail commission (of the amount invested) and 0.5% of the amount not invested. So, if they have a client who has the minimum, they are looking for, of £500k and they invest £100k, they'll be looking at £6k commission (I mean fee), £500 for every protection case and £3k a year in trail!! So in the first year, they'll be looking at earning upwards of £10k per client, at the very least. Obviously, I'm now going to have to change my business model - all I need to do is find some clients that re rich/dumb enough to pay the fee (commission). Sorry - I know that was all a bit off subject. Regarding qualifications, I can't stand exams, expecially when they're unlikely to benefit my clients - but of course if having all those letters after my name will mean someone will pay me £10k, I might just do them!

Posted by: Mark

reply to Harry and Mark whatever your last name is

Harry, thanks for the English lesson and thanks for continuing to try to demean my views. I find it strange that I am accused of being ageist when you are doing exactly that. ‘Unless you have 50 years experience you don’t know what you are talking about blah blah blah’, utter nonsense. As far as piping down, dream on, if the objective of those that have commented was to discourage me from shining a light on the unacceptable face of financial advice then it has failed entirely, you will be hearing plenty more from me. As for Mark, brave sarcastic Mark, he chooses to interrogate my fee proposition in a fashion suggesting that I have something to be ashamed of. How dare I charge clients in an a simple, transparent and ethical way for services they value. Unsurprisingly, he comments on the fact that our planning fees are charged whether the client implements our recommendations or not. I assume he is so stuck in his product pushing ways that this is an anathema to him (In case you didn’t spot it, this is the difference between fees and commissions). My firm sells advice for which the client pays, if the client wishes to implement the advice with us we will charge them, if they wish to implement it elsewhere, that is fine. If they wish a long term review and maintenance relationship where we meet 6 monthly we will charge them for that. Simple. Anyone who wishes to come and visit us and examine our ways of working is very welcome. Anyone who thinks that their commission based approach would persuade our clients that they should use their services is living in dream land, all of our clients used to get ripped off like that and will not be going back to it.

Posted by: Steve Martin

It's still commission!

Steve, somewhat slightly got his back up, Steve, I don't mean to offend, so my apologies if I have. Should you be ashamed of your fee proposition? Of course not, but I, personally, wouldn't be proud of it, rich but not proud. You're going for the high-net worth end of the market, which is fair enough, nothing wrong with that, but by essentially insisting that clients have at least £500k you're all but guaranteeing that you earn at least £2,500 per client, even if they do nothing and go and see another adviser. And if they do invest, you make a charge for their entire assets, even the amounts that presumably you've recommended stay in cash etc... That part especially for me, doesn't seem too ethical - simple & transparent, yes, but not ethical. I just can't see how a percentage of assets can (or should) be called anything but a commission. Obviously, as my last post would indicate, I work a little different - if somebody doesn't go ahead with my advice, or if my advice is to, for example, leave everything as it is, then I don't charge anything. Some would say I'm crazy, I provide good quality advice and quite often I don't get rewarded for it - apart from referrals, the knowledge that, in my view, I've not ripped off the client and the client is most likely going to come back to me in the future. But I'm happy doing things this way, as are my clients - I don't think any prospective client has gone elsewhere. I charge an hourly rate (which I would consider to be a proper fee) or clients can choose that I am paid commission instead - I don't care as long as I get paid, it's roughly the same figure (the commission is usually a bit less, because of the VAT on fees) and it doesn't alienate those that cannot afford to pay the fee. Our clients, I would imagine, like our business models, are poles apart, the vast majority of my clients are low to middle earners and the majority of business I write is pension transfers - so the ability for the product to be able to finance the fee, is often very important to the client - it's clearly not ripping clients off!! I don't think any of my clients would be able to afford your fees. That's not to say your model is wrong, clearly it works for you, but my whole point, is that I don't believe it should be sold to clients as not really being commission and that other business models have to continue to be available for the mass market. My last name is Lloyd by the way

Posted by: Mark

2 Extremes

You've got 2 extremes of advisers 1 The lazy ones who can't be bothered to do any non sales training 2 Some Chartered advisers who would like to see only their firm do business. PS The way in which firms get chartered status is a bit misleading...it implies all the firm's advisers are superbly qualified when only a limited number may have reached level 6.

Posted by: Sean Wilson

The Future

I have just read Steve's article, and the associated comments and would like to add mine as follows:- Qualifications I don't think Steve has suggested for one minute that advisers with 30 years + experience are not capable of giving a great service to their clients, or conversely that a relatively new entrant to the industry with Chartered, Certified etc status is in any way superior to FPC qualified advisers. The reality is that if we want to continue giving financial advice to our clients post RDR then all of us, like it or not, need to get to QCA Level 4 under the RDR proposals as they are right now. My own personal view is that this should be increased to Level 6 in due course if we truly want to be seen in the same light as other professionals, but that's for another day. After 17 years working for other companies, I, along with my business partner, set up a small practice last summer so I am well aware of all the various roles that need to be filled in doing this, and the time pressures that brings upon us as individuals. My free time is very precious to me as I am sure it is to all of you, however I have taken the position to push myself in order to get myself qualified way beyond what our regulator requires for the sake of my own personal development, not so I can have an 'alphabet' of letters after my name and as some suggested 'lord-it' over less qualified advisers. Having passed the IFS Diploma in Financial Advice (DipFA) last year, I have recently done the CFP assessment and currently awaiting the results, next is the IMC in March and then the STEP Certificate for Financial Services (Trusts & Estate Planning) in November. The study I have put in so far for all these exams has genuinely helped me give a better service to my clients which is surely what all this is really about. I believe the the old saying 'you don't know what you don't know... until you learn it!' was never more appropriate for me right now and I am sure it must be the same for others. One final point on qualifications etc, I think we should have a separate Professional Standards Body (PSB) that confers the title of 'Financial Planner' based on experience, qualifications (no matter who the exam body is CII, IFS, IFP, CFA, STEP, et al) and ethics. Once this title is given, regular CPD maintains it. The benefit is that the public can, in time, have confidence that any adviser with the 'FP' designation after his/her name is experienced, ethical and qualified to a professional level. This can only be good for everyone. Commission, Fees or is it CAR? We are all free (at present) to be paid for our services by the method that suits our business model and our clients best. Post RDR, if I understand correctly, commission as we know it today will no longer be an option, so let's get real and start accepting what our world is going to look like in 2013 onwards. I am personally bored rigid by the commission v fees debate, the only issue is that we are paid for our services by a Customer Agreed Remuneration (CAR) system and not at a level dictated to us by the product providers. It matters not if it is commission (initial or trail), hourly rates, retainers, % of funds under advice, plan fees, whatever, as long as your client knows what the amount they are paying and what they get for that payment... and they agree to it. I have empathy with the comments that some have posted about clients in the lower socio-economic groups who may be forced by the RDR into the hungry jaws of our wonderful banks or these new breed direct sales forces that appear to be springing up from the insurance companies who must be frightened to death of losing market share and influence in the post RDR world (shame). If we are really honest with ourselves about 90% UK households could do a lot worse than adopting the following advice from threesixty's very own Phil Billingham:- Spend less Save more Insure the breadwinner Make a will How much could you charge for that advice, especially as it will be on our website for free. That leaves around 10% (or 6 million) of the population who are in real need of the truly independent professional services we are able to offer them no matter how we are eventually remunerated. We owe it to all of them and ourselves to move on from these discussions and accept where we are going and stop lamenting the past.

Posted by: Paul Higson

Reality

As a young adviser, I am genuinely sad to see the personal attacks which have been made in this debate. Whilst I can fully understand why people would feel strongly about this issue, I feel that some otherwise reasonable people are not presenting themselves or our industry in the best light (irrespective of your viewpoint on exams). When I joined the industry a mere 9 years ago, I was told that clients look for integrity, knowledge and transparency from us as advisers. I think that the FSA/some industry professionals are mistakenly trying to kill three birds with one stone, so making fundemental mistakes - but we need to wake up to the reality that all is not well. A little while ago, a similar debate raged in the mortgage market and whilst nobody had ever ripped off a client or falsified an income everone knew it had been done - in a similar way most advisers have come across clients who have clearly been poorly advised (some based on commission bias). So we need to accept there is a problem with some, but not all advisers. But as with all laws, they apply to the lowest denominator, but are frustrating for the rest of us. The RDR is an imperfect extension of this. I have personally witnessed the problems with grandfathering, s I worked with an adviser who never sold a PEP/ISA, everything was with-profits bonds - he was a genuinely lovely guy, who taught me so much about client relationships and his clients genuinely loved him, having worked with him all their lives - however knowing everything I know now, it doesn't make it all right. So at some point the line must be drawn and a minimum level of knowledge created. The real question is how is this assessed - if work based assessments can ensure the same level, then surely that is the end of the debate? Final point, exams only cover part of the knowledge, experience the other; whilst CAR/industry wide commission (rather than scrapping commission) will improve transparency, nothing but personal pride can improve integrity!

Posted by: Bode