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How nine wealth management firms are entering financial planning

Wealth management firms are entering or growing their financial planning divisions. New Model Adviser® has asked nine firms about their plans for planning.

The years leading up to and following the retail distribution review (RDR) in 2013 saw many financial planners ditch investment management capabilities, choosing to hang their hats on a holistic planning proposition instead. But now wealth management business, the powerhouses of portfolio management, are bolstering their own financial planning capabilities.

New Model Adviser® has spoken to a number of wealth management firms with rising numbers of planners in their ranks. We will be presenting our findings and analysis in a number of ways, but first take a look at what the wealth managers told us about their planning divisions. 

The years leading up to and following the retail distribution review (RDR) in 2013 saw many financial planners ditch investment management capabilities, choosing to hang their hats on a holistic planning proposition instead. But now wealth management business, the powerhouses of portfolio management, are bolstering their own financial planning capabilities.

New Model Adviser® has spoken to a number of wealth management firms with rising numbers of planners in their ranks. We will be presenting our findings and analysis in a number of ways, but first take a look at what the wealth managers told us about their planning divisions. 

Brewin Dolphin

How many financial planners were employed in the last 12 months? What are the future growth plans?

It employed 11 financial planners and advisers between 2017 and 2018. It will continue to look to employ talent. 

How many branches have financial planners?

27 offices have access to a planner. 

What role do they perform: e.g. standalone service, support for wealth management business, or both?

Both. 

What is the charge for the financial planning service? (in the context of overall charges)

Initial charge: 2% on the first £500,000, 1% on the next £500,000.

Ongoing charge: 1% (including investment and financial planning advice). 

What qualifications do planners typically have?

Typically the Chartered Insurance Institute (CII) Diploma in financial planning as a minimum. 

What is the house financial planning process? Does it follow the CISI’s six-step formula?

Yes, it follows the Institute of Financial Planning’s six-stage financial planning process. 

Does the firm currently have, or plan to create, any kind of digital advice or guidance proposition?

It introduced its WealthPilot initiative in 2017. This is a needs-based wealth-planning and investment advice service, which the firm is digitalising. It is delivered by qualified advisers over the phone, by Skype, or face to face in the office.

Canaccord Genuity

How many financial planners were employed in the last 12 months? What are the future growth plans?

Nine people in the wealth planning team. With the integration of Hargreave Hale, Canaccord Genuity Wealth Management (CGWM) is looking to broaden the scope of wealth planning and build the team. 

How many branches have financial planners?

Currently, just the London office. The firm is assessing the opportunity to introduce wealth planning to more regional offices.

What role do they perform: e.g. standalone service, support for wealth management business, or both?

Both. 

What is the charge for the financial planning service? (in the context of overall charges)

Initial fees of £2,000 + VAT, implementation fees of 1% to 3% and an ongoing advice fee of 0.3%.

What qualifications do planners typically have?

Mostly chartered, some certified. One is qualified to give advice on long-term care.

What is the house financial planning process? Does it follow the CISI’s six-step formula?

CGWM has a four-stage process: 1. Client engagement. 2 Strategy and planning. 3. Implementation. 4. Review and update.

Does the firm currently have, or plan to create, any kind of digital advice or guidance proposition?

Not currently. 

Charles Stanley

How many financial planners were employed in the last 12 months? What are the future growth plans?

The firm continues to look to appoint high quality advisers.

How many branches have financial planners?

Financial planning services are available across all branches, with the service carried out from regional hubs.

What role do they perform: e.g. standalone service, support for wealth management business, or both?

They provide financial planning services. Often this involves an investment solution from private client investment management or asset management.

 

What is the charge for the financial planning service? (in the context of overall charges)

The initial fee is normally 1% of the value of the assets. Ongoing fees are either 0.5% or 1% depending on the investment solution recommended.

 

What qualifications do planners typically have?

Minimum Level 4 qualifications but many exceed this and are chartered financial planners.

 

What is the house financial planning process? Does it follow the CISI’s six-step formula?

Charles Stanley takes a holistic view of each client’s circumstances. This includes regular reviews and access to the wider team’s expertise.

 

Does the firm currently have, or plan to create, any kind of digital advice or guidance proposition?

Financial planning clients tend to prefer dealing directly with the team rather than interacting with digital. If a client has demonstrated a strong demand for this kind of service, the firm would look into it.

Close Brothers Asset Management

How many financial planners were employed in the last 12 months? What are the future growth plans?

115. 

How many branches have financial planners?

10 offices. 

What role do they perform: e.g. standalone service, support for wealth management business, or both?

Full financial planning. 

What is the charge for the financial planning service? (in the context of overall charges)

A tiered rate, which applies in stages and is based on the total value (including any growth).

Initial £250,000 is charged at 1%, next £250,000 at 0.75%, and over £500,000 at 0.5%. 

What qualifications do planners typically have?

CII diploma.

 What is the house financial planning process? Does it follow the CISI’s six-step formula?

Goals-based financial planning: income, expenditure, assets, liabilities, and structures (tax wrappers, tax position).  

Does the firm currently have, or plan to create, any kind of digital advice or guidance proposition?

Goals-based financial planning: income, expenditure, assets, liabilities, and structures (tax wrappers, tax position). 

European Wealth

How many financial planners were employed in the last 12 months? What are the future growth plans?

Eight financial planners based in central London and across the UK. It plans to expand the advice team. 

How many branches have financial planners?

Three (London, Manchester and Worcester). 

What role do they perform: e.g. standalone service, support for wealth management business, or both?

Direct client relationships, advising on a wide range of areas. They use European Wealth’s investment managers for discretionary investment portfolios.

What is the charge for the financial planning service? (in the context of overall charges)

0.5% for a standard financial planning service, 0.8% for a premium financial planning service and 1.25% for an all-inclusive financial planning and discretionary portfolio management service. 

What qualifications do planners typically have?

Typically Level 6 or Level 7 CII qualified and several are chartered financial planners. 

What is the house financial planning process? Does it follow the CISI’s six-step formula?

An in-house structured financial planning process including a detailed profiling of the client, the introduction of appropriate specialists and regular review. 

Does the firm currently have, or plan to create, any kind of digital advice or guidance proposition?

The firm has an online client portal and is developing a fully digital client suite.

Foster Denovo

How many financial planners were employed in the last 12 months? What are the future growth plans?

68 planners on 31 December 2017; 70 as of 14 March 2018. Foster Denovo is committed to growing the business through carefully selected acquisitions of other financial planning and wealth management businesses and by recruiting individual advisers.

How many branches have financial planners?

Seven (London, Weybridge, Bromley, Essex, Fareham, Sheffield and Newcastle.)

What role do they perform: e.g. standalone service, support for wealth management business, or both?

All offices are client facing and as such financial planners and their support staff tend to be based in the same office. 

What is the charge for the financial planning service? (in the context of overall charges)

Foster Denovo declined to comment.

What qualifications do planners typically have?

Planners have CII and London Institute of Banking and Finance qualifications. Some have CISI qualifications.

What is the house financial planning process? Does it follow the CISI’s six-step formula?

The firm operates its own propositions and processes depending on the service required by the client. In most cases, cashflow modelling is central to the service.

Does the firm currently have, or plan to create, any kind of digital advice or guidance proposition?

Clients can receive advice digitally. Clients can see their adviser, view documents and, in some cases, sign documents digitally. They may also be involved in building their own cashflow report too.  

Killik & Co.

How many financial planners were employed in the last 12 months? What are the future growth plans?

Killik & Co has promoted from within and hired externally, adding four qualified planners. It has taken on a significant number of trainees who will become planners over time. 

How many branches have financial planners?

Most planners work out of the firm’s Mayfair, London head office and service all branches as required.

What role do they perform: e.g. standalone service, support for wealth management business, or both?

There is a joined-up approach between investment management and wealth planning. 

What is the charge for the financial planning service? (in the context of overall charges)

The firm charges for both services. It operates a flexible fee-based model, tailored to the clients’ requirements (Killik would not provide any figures to illustrate typical fees and charges).

What qualifications do planners typically have?

Financial planners hold at least a level 4 qualification, offering more general planning advice. Wealth planners are chartered.

What is the house financial planning process? Does it follow the CISI’s six-step formula?

The firm has its own in-house processes ‘centred around empathy, intelligence and understanding’.

Does the firm currently have, or plan to create, any kind of digital advice or guidance proposition?

Technology solutions help the firm’s experts deliver advice in a way that suits clients. But the firm believes digital advice will never entirely replace the expertise and empathy of a human.

Sanlam

How many financial planners were employed in the last 12 months? What are the future growth plans?

One, but the firm is looking to grow this year internally by 10. Last year it created Sanlam Partnership with 150 advisers joining following the acquisition of the Tavistock network. 

How many branches have financial planners?

Five (London, Bristol, Fareham, St Asaph and Worcester).

What role do they perform: e.g. standalone service, support for wealth management business, or both?

Sanlam Wealth Planning offers planning and wealth management services. 

What is the charge for the financial planning service? (in the context of overall charges)

Sanlam charges a strategy fee and implementation fee, based on the complexity of the advice, and an ongoing advice charge up to 1% a year.

What qualifications do planners typically have?

All are moving towards chartered status.

What is the house financial planning process? Does it follow the CISI’s six-step formula?

It has four life stages: wealth creation; maintenance and growth; protection of wealth; and preservation of wealth. 

Does the firm currently have, or plan to create, any kind of digital advice or guidance proposition?

Not at present, but it is being looked at as part of the wider group.

Walker Crips

How many financial planners were employed in the last 12 months? What are the future growth plans?

Eight, with the aim of adding one per year in future.

How many branches have financial planners?

Four out of 13.

What role do they perform: e.g. standalone service, support for wealth management business, or both?

Both.

What is the charge for the financial planning service? (in the context of overall charges)

It has a set fee scale, initial and annual, with the option of time cost fees.

Walker Crips’ initial fee is 1.5% up to £200,000 and 1% on assets thereafter. Its annual fee is 0.75% or 1% depending on the level of service required.

What qualifications do planners typically have?

All have diplomas, four are chartered and the others are nearly chartered.

What is the house financial planning process? Does it follow the CISI’s six-step formula?

Yes.

Does the firm currently have, or plan to create, any kind of digital advice or guidance proposition?

Potentially. Walker Crips is looking at in-house options and Dynamic Planner’s AccessAdvice for digital supported advice.

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