Around 4 years ago I fell out of love with financial advice.
I found out that my father had been mis-sold pensions and investments by people he trusted. The whole family finances suffered because of some very slick salesman who sold a very complicated scheme. The result was disastrous.
I walked about for about an hour and I had quit the profession in my head.
It goes without saying that young advisers learn from those who are older and more experienced. But what is perhaps less obvious is that advisers in the early stages of their career can learn a lot from each other.
That realisation and the lack of opportunities for younger advisers to meet and share best practice inspired Xentum director Adam Carolan to launch NextGen Planners with Postcard Planning director Rohan Sivajoti.
I have been pretty vocal about being disappointed about the state of the financial advisory profession. I even co founded a company to help shape the future of Financial Advice called NextGen Planners.
I do however think we are starting to see a sea of change in the financial advisory world.
As a business owner, sorting your own personal finances can be difficult. This 10 minute quiz gets to the bottom of whether you are giving your personal finances enough time and effort.
If you have read my blog for long enough now, you will know that I like to start off with a story.
When I was 16, my father gave me £2,000 to invest. The money was really his but it was up to me to find the stocks to invest in.
So off I went, into the back of the Daily Mail (don’t judge me). Towards the back of the Daily Mail in the Business section, are a number of different share prices and companies with some brief performance figures. I had made my mind up
I love what you are doing. I see a revolution emerging at the moment that puts financial control and transparency back in the consumers hands. I love the innovation, the interfaces and the technology that you have built and I really like the ease of use which has left me scratching my head why it has taken so long to get to this point.
I do however have some headlines that I think you should pay notice to
Everywhere I look at the moment, I seem to find a business guru showing entrepreneurs how to “scale up” or “grow” or “plan your exit” and all those popular buzz terms.
I have a different phrase that needs to be addressed by a business owner - “Do you actually know your F you number”
Whenever I meet a new business owner I always ask them about how they started their business.
It usually goes something along the lines of:
“I just had an idea that I thought would help people” or “I wanted control over my week” or my favourite “I wanted to change the world”.
Everybody’s story is different and is always fascinates me to question why someone started a business as it gives me an insight into their mindset.
I have spent a long time pondering this question for a while:
“Why don’t I want to deal with my money”
It is a really important question to me as I deal with people’s finances for a living.
What do I mean?
I don’t like looking at my online banking. I don’t enjoy reading paper statements of what I have spent and I certainly don’t like dealing with financial services in general from banks to the insurance companies that hike my prices for being loyal (yes that one grinds on me).
I know some people enjoy looking at their bank statement and investments every day, but I am not one of them. This particular blog is probably not for you if that is the case.
I often get asked:
“How much return do you think you can get me Adam?”
I will tell you my answer - I don’t bloody know :). No one can predict the markets, if they tell you they can, I would run a mile. All I can do is look back at what has happened previously and I can advise on what I think gives you the best chance of making a decent return - Hint, it is usually just buying a cheap global index tracker.
A financial planner will dig into your financial life. They will want to know what drives the decisions you make and what keeps you up at night and if you have a partner they will want to know this from both of you. Without this conversation a true financial planner doesn’t feel they can do their job effectively so they will ask difficult questions and try to understand what it actually is that you want to achieve.
Just a quick thank you to all my readers and everyone I have met in 2016. I hope you have a prosperous 2017.
I will let you into a secret. Money is designed to make you fail. Very clever people realised many moons ago that people don’t like to deal with their money and personal finances.
The banks realised that if they sold you a really attractive 0% credit card, the chances are that you are not going to pay off the balance and get charged a fairly high rate of interest when the “teaser rate” ends. Teaser rates are by nature meant to tease you in and then a game begins. They are basically backing themselves that they will beat you, mainly due to people’s inertia or lack of control over money.
I have a confession. At the start of the year, I got my work/life balance way off.
I had just had a knee operation, and setup another company (training younger planners) all at the same time as advising at Xentum and also being a Director on the Board. Things were busy but in all honesty, I was loving it. I loved my job and I was starting to really see some progression in my career and for the first time in a long time, I was really passionate about the future of the financial planning.
First off - this is not a plug. I have been using Monzo for a few months now and wanted to give my thoughts on how my family has used it. I have not been paid to write this article and Monzo if you reading this, you know my card details :)
I actually managed to get hold of one of the first Mondo Beta Cards. Yes it was called Mondo before they decided to rebrand with a new name with something that made me immediately think of Sesame Street (I love Sesame Street).
Everywhere I look, I see ways to save money. I see utility companies falling over themselves to get my business. Only this week I switched from Sky to BT and pocketed £130 through a cashback site. You cannot breathe in the modern world without some kind of sale getting you to part with you hard earned cash.
Where I don’t see it yet is personal finance and although the profession is getting better at being transparent, it isn’t being discussed enough. People generally don’t know what is a good deal and bad deal in personal finance, especially business owners who frankly have better things to do. I am therefore writing this blog slightly out of frustration as every client I come across these days seems to have been flogged a bad deal at some point and hopefully this improves awareness.
Earlier this year the government announced that it would be introducing Lifetime ISAs from April 2017 to help address the dilemma facing young adults of getting on the housing ladder and the need to save for retirement.
The key features of Lifetime ISAs are:
I will always remember one of my first clients at Xentum. It was a couple in their late 50s and the husband/father of the family was approaching retirement in his head. I specifically remember this client as they brought a box of paperwork into the office with the message:
“There you go, can you sort through that and let me know when I can retire”
It will always stick with me that particular sentence. At the time, I found it unbelievable how someone had worked so hard for 30 plus years had no idea how much or what they had in savings, life cover or investments. They had of course been sold all sorts (some good and some bad) and had merely switched off from the issue of finance.
I wrote this article for a popular financial advisory blog called the Adviser Lounge
I am thinking a lot at the moment about the route to becoming a top end financial planner. It is partly the work I am doing with Nextgen planners but I am also interested in this anyway. I have always had a chip on my shoulder about age in financial planning. As a young planner, I have obviously had the mantra that if you are good enough, you are old enough.
I have had quite a few meetings recently with people looking to sell their business. It is the dream isn’t it - sell your business for millions and gain financial freedom overnight. Having been through this with quite a few clients over the years I thought it might be quite valuable to actually raise some questions that a business owner needs to think about when going through the process:
