When’s the best time to start a new career in financial services?
Probably not during a huge market crash following an historic earth-shaking event. But that’s where my career as a financial adviser started. Back in 2001, a few weeks on from the 9/11 terror attacks, with the markets in free-fall.
Not a time for faint hearts and second-guesses. Although I was definitely second-guessing my career choices at the time!
The industry’s changed since those rocky first few months in late 2001. Financial advice is now more of a profession on a par with law and accounting. And there have been changes that affect you in different ways; some for better, and some for worse. But every change has taught me something important, that I’ve put to work for people like you. So let’s dive in. A brief 20 year tour through the financial services profession (and some free tips for your finances):
Three things that have changed for the better
Our regulator, the Financial Conduct Authority, isn’t perfect, but the Retail Distribution Review (RDR) in 2013 shook up the industry. It raised professional standards by demanding more from UK advisers, encouraged innovation and it clarified services for its clients. Financial products are now much simpler, much clearer, and much more cost effective than ever before.
The financial services sector isn’t the Wild West. Improved regulation and safeguards mean that your money is even safer than ever in the hands of a qualified, skilled and experienced financial advisor.
Back when I started, all this was paper, as far as the eye can see. Research? Done by leafing through papers. Cashflow? Plotted out on paper. Information and updates? A stack of paper thudding on to your doormat, once a month. Now, online technology’s made everything quicker, simpler and more efficient. We have access to research platforms that allow us to manage your investments more efficiently, and you have 24/7 access to your accounts.
We might all be sick of virtual meetings after the lockdown, but technology’s been great – giving you more choice, better sight of your money, and helping us manage risk more effectively.
It’s not just us who’ve changed. You’ve changed too. Back in 2001, most of my clients were people investing money for money’s sake or because it’s the sensible thing to do. Now, there’s been a shift. You don’t just want a return on your money, you want better returns in life. It’s not just about generating x% annual returns, it’s investing with purpose; retiring five years early and maintaining a long-term lifestyle that might once have seemed out of reach. And that’s incredibly satisfying.
Focusing on what your money can do makes it easier for you to make the right investment decisions. With our help, of course!
Two things that have changed for the worse
It’s never been easier to cause yourself unwarranted financial stress. The 24 hour news cycle and ever-present social media means there’s more demand to fill pages, airtime and advertising spaces. You can quickly and easily find a news story about the imminent collapse of the entire financial system, and the end of life as we know it.
The nature of the news media is to make every problem in the world your problem. If your financial decisions are too heavily influenced by the days’ news, you’d never invest, and you’d be poorer for it. So view financial news with a healthy dose of cynicism. You’ll be happier.
We used to say “a fool and his money are easily parted.” Well if that was true, internet scammers wouldn’t put so much effort into preying on the vulnerable, the desperate, the uninformed and the just plain unlucky. Some scams are dressed up so well, I’m not surprised people think they’re legitimate.
Never, ever be afraid of asking tough questions to determine if a service or an offer is legitimate. I’d rather every client ask to see my qualifications and want to know more about my level of experience than just one fall for a scam.
And one thing that still needs to change….The Advice Gap
This was the hardest part of the blog to write because, really, there’s so much to be positive about. But where financial services still needs to do some work is in closing the advice gap. There’s a huge section of the population that just don’t need our level of service because it doesn’t make financial sense. But we still need to make sure they’re well served. Automated advice services have picked up some of this slack but limited take-up seems to suggest that the human-touch is still highly valued. We’ll continue to watch this space with interest.
It’s all about seeing the big picture. Whether it’s embracing regulation instead of pushing against it, or putting technology to work for smart investors who are focused on what their money can do for them. Having that overview of the whats, hows and whys of your finances – and your future – is key.
It’s taken 20 years and a lot of hard work to build that big picture and understand how everything fits together, but it won’t take you that long at all. Just give Arkenstone a call and I’ll share it with you. A quick call with one of VouchedFor’s Top Rated advisors (as featured in The Times, no less!), and you’ll have that all-important overview you need.
Together, we’ll help you figure out exactly what your money needs to be doing for you.
This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.
A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The value of your investment (and any income from them) can go down as well as up and you may not get back the full amount you invested. Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.