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Adviser profile: Claire Phillips of First Wealth

Despite plans to cut client numbers in half this year, Claire Phillips says First Wealth is committed to closing the advice gap and improving financial education

Claire Phillips' CV

2010–present    First Wealth, partner (previously practice manager, financial planner, paraplanner, trainee adviser)

2007–2010: Target Financial Management, adviser/paraplanner

2003–2007: S&P Financial Planners, adviser/paraplanner

2001–2002: Travelling and working in Australia and southeast Asia

1999–2001: Mercer, compliance approver on pension review

1998–1999: Legal & General, pension transfer analyst

1997–1998: The Pensions Regulator, administrator

 

PROFESSIONAL MEMBERSHIPS/QUALIFICATIONS

Chartered Financial Planner

Fellow of the Personal Finance Society

Certified Financial Planner

Claire Phillips' CV

2010–present    First Wealth, partner (previously practice manager, financial planner, paraplanner, trainee adviser)

2007–2010: Target Financial Management, adviser/paraplanner

2003–2007: S&P Financial Planners, adviser/paraplanner

2001–2002: Travelling and working in Australia and southeast Asia

1999–2001: Mercer, compliance approver on pension review

1998–1999: Legal & General, pension transfer analyst

1997–1998: The Pensions Regulator, administrator

 

PROFESSIONAL MEMBERSHIPS/QUALIFICATIONS

Chartered Financial Planner

Fellow of the Personal Finance Society

Certified Financial Planner

Business top tips:

Claire has given us these great top tips for business:

1. Hire great people and invest in them. Top staff are one of the best resources available to you.

2. Challenge yourself and the business.

3. Do not be afraid to change things if they are not working.

4. Define what good looks like. Build it into your processes and embed it in your corporate values.

5. Be honest and realistic.

Giving something back (pt.1)

When you reach moments of success, 'it’s time to give something back.'

Claire Phillips, partner at London-based First Wealth, is making the most of a fruitful business by aligning her work with her personal goal to help those less fortunate.

She volunteers on a phone line that supports people with mental health problems and stewards at Parkrun events, the free, mass participation runs organised in green spaces across the UK, which she also takes part in. Now, through First Wealth, she is helping to educate young people about financial services. 

She also plans to extend the company’s graduate programme. First Wealth plans to hire someone who has not been to university to go into schools in their local community. They will train students and talk to them about the benefits of joining the profession.

'It doesn’t matter whether they had not been able to go to university or chosen not to,’ says Phillips. 'Once they have been through our graduate programme they would act as a powerful role model for kids at the same school they themselves had previously been to,' Phillips explains.

Top quote:

'I am working my goals into the business. I have worked with the Chartered Insurance Institute, going into schools, working to encourage young people into the profession. Ultimately First Wealth wants to develop its own financial education programme.'

Giving something back (pt.2)

Like Phillips, fellow First Wealth partner Robert Caplan is passionate about sport and fitness. They are weaving this into the firm’s planning ethos. The firm sponsors 24-year-old cruiserweight boxer Isaac Chamberlain and is releasing the e-book I Have a Plan about financial planning for sports professionals.

'Isaac is a good example of what we are trying to achieve,' Phillips says. 'He is young, he has a limited lifespan in terms of his career but Robert is putting a financial plan in place for him now. There is no point him having a plan when he has finished his career. It would be too late.'

What has spurred these recent innovations?

'When you first start a business, you are so busy running on the spot to make it happen,' says Phillips. 'We are at the stage now where we can look deeper into the business and ourselves and ask: "what do we want to be doing in the short, medium and long term?" We want to build a plan and vision, and put that into practice.'

Top quote:

'It is especially important for sportspeople to have a plan. They potentially receive a lot of money early in their career, but that can end tomorrow if they get injured for example.'

 

Best behaviour

The aim is to build coaching into the whole planning process. ‘It will be integral from day one when we first meet someone,’ says Phillips.

‘It does not have to be forced, just gentle discussions around certain subjects. We have to understand why clients feel a certain way about certain things, and point out things that could build up their confidence.

‘Ultimately, it is to help educate them to make better and more rational decisions.’

Villis has set the ball rolling at the firm on behavioural economics by writing a series of blog posts on the topic, which can be found on the First Wealth website.

In a moving post about a life-changing health scare his wife went through, he explains how he used behavioural economics to challenge what was holding him back from doing what he really wanted to do.

With the fresh perspective on how short and precious life is, some insights from behavioural economics and the help of a good financial plan, his family made some big changes. Now Villis is more determined than ever clients should share in the benefits offered by this approach.

Top quote:

[From Anthony Villis' blog] 'We use phrases like ‘you only live once’, ‘life is not a rehearsal’ and ‘live for today’ every day in our work with clients, but it’s only when life delivers a sledge hammer blow to you like this that these phrases really create massive emotional meaning.' 

High praise (pt.1)

Having first hired Phillips as a trainee adviser in 2010 and made her a partner last year, Villis exalts Phillips’ ability to bring their business aspirations to life.

‘Claire’s role within First Wealth has evolved as the business has grown,’ he says. ‘She excels in every role she performs, and has been integral to the growth of First Wealth.

‘She decided a couple of years ago she wanted to be a full-time adviser, and we have supported her in her ambition. Clients love her, and her professionalism is unsurpassed.

‘Claire sits on the management team, and her energy towards making First Wealth the best business it can be is awesome. She performs a systems and compliance overview 

function, making sure things run smoothly, and is always the go-to person in terms of knowledge or technical detail.

Top quote:

[Anthony Villis] 'She’s passionate about using First Wealth as a conduit to financial education, and we’ll look to support her further as this role grows.'

 

High praise (pt.2)

Phillips puts her technical skills down to a ‘baptism of fire’ she received when starting out at as a paraplanner at single-adviser firm S&P Financial Planners in Croydon in 2003.

S&P had been an early adopter of Institute of Financial Planning principles and she liked the values of the firm. But it lacked the software that enables planning today.

‘When I went there I was doing cashflow models but it was just me working on an Excel spreadsheet, and I was writing full plans for people,’ she says. ‘It had no templates or anything. It was a baptism of fire. On day one I was at a client meeting.'

Her willingness to learn has clearly carried over to First Wealth, where she is now teaching others and giving back as well.

Top quote:

[On starting out at S&P] 'I learnt so much so quickly and they were very good at letting me go and do training.'

 

The fee bit...

In a free initial meeting, First Wealth clients receive a data analysis, lifetime cashflow modelling and a report called 'Your Financial Plan.'

'The vast majority of people who have had a "Your Financial Plan" review might not want to do every single thing within it. But they will want to work with us,' says Phillips. 'Going through the process is a good test of their commitment to us as well.'

There is enough in the plan for clients to take it and implement it themselves. Alternatively, First Wealth charges £2,000 for implementation. If the client goes ahead with cash investments or transfers a pension or ISA at this stage, there is a 1% initial fee.

But why keep this step so distinct from the rest of the service? Because, Phillips says, First Wealth wants people to know it is providing the service for them, not so clients then need to invest a certain amount with the firm.

Previously the initial fee that came after the initial report was between 1% and 2%. But, she says, it was brought down to 1% to ‘lower the barrier to entry’.

For ongoing services, clients pay a 1% advice fee. For this they can expect at least one review each year. Each one looks at the client’s attitude to risk, their portfolio performance against their goals and updated lifetime cashflow modelling.

For the 1% ongoing fee, clients also receive an annual portfolio rebalance and an annual valuation. Throughout the year clients can get in touch about their portfolio or any other financial matter, adapting their planning goals if needed.

They can also view their consolidated valuations and platform holdings via a platform login.

The investment bit

As a Best Practice member that uses the network’s Fusion platform, First Wealth can manage portfolios on a discretionary basis.

The firm also uses Fidelity FundsNetwork, Ascentric and Old Mutual Wealth platforms, but Phillips says these are mostly used to resolve legacy issues.

The firm outsources its investment research to Independent Strategic Research (ISR). It has an investment committee made up of two ISR researchers plus Phillips, Villis and Caplan. The five oversee three suites of portfolios: income, wealth preservation and accumulation.

For each suite there are seven iterations of the portfolio. The firm uses FinaMetrica’s risk profiling tool.

‘We give ISR overall thoughts and feelings and a steer,’ says Phillips. ‘From that it develops a mandate we have all agreed. It crunches the numbers and comes up with the fund recommendations. We then say “yes” or “no” or look at changing things.’

Considering the firm was created one year after the global financial crisis, it should come as no surprise the investment philosophy is one of taking absolutely no unnecessary risk. Phillips believes this fits well with changing trends in client preferences.

‘Across all the portfolios we tend to be quite conservative,’ she says. ‘That helps with longer-term planning for clients. It helps keep their blood pressure low, and ours.

‘We are straightforward. We do not like to do anything too fiddly. Investments are important but planning is just as important.

‘In the past, clients wanted to shoot for the stars. Now many more are happy with a “steady Eddie” approach. They know they are not going for top returns but they will not suffer big dips either,’ says Phillips.

When confronted with clients that do want to take risks First Wealth deems unnecessary, Phillips says the firm is not afraid to have the conversation about taking things down a notch. 

Core holdings in the wealth preservation range include the BlackRock Absolute Return Bond fund; the Jupiter Strategic Bond fund, managed by Citywire + rated Ariel Bezalel; and the Insight Absolute Insight fund.

The best of Twitter:

You can follow Claire on Twitter with the handle @mspi70. Here are some of her best moments:

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