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What makes a good financial adviser?

There’s no doubt that the RDR has been, and still is, one of the biggest change factors affecting the advisory market. We know all the rules, the developments in adviser charging, and the need to meet a defined minimum qualification level.

But how does this change the fundamental characteristics required of a “good adviser”? At BWD we are naturally interested in qualification standards through our on-line learning and mock exam courses. But through our recruitment business we are also interested in understanding what firms seeking advisers are looking for.

We talk to sufficient numbers of advisers and those recruiting advisers every day of the week which enables us to build up a really accurate picture. As a result, we think the 2013 ‘Model Adviser’ needs to be a little different. Let’s look at a few areas:

  • Starting with the most obvious – to give advice in 2013 you need to be QCF Level 4 or equivalent.

  • Some firms are setting out their stalls as independent – some are saying that restricted advice is fine whilst others are saying that “Chartered” is the new independent. We are finding that more advisers are considering or taking the Chartered route. Others are not yet at Level 4 and demand for our on-line courses is increasing by the week.

  • The 2013 ‘Model Adviser’ needs to be prepared to continue the professional development route. Not everyone can be a qualifications enthusiast – but we have now left behind the world where experience is the only requirement. It would be rash to expect no new demands on the adviser community – the good adviser will have to be up for the challenge.

  • The other big change relates to adviser charging. Some advisers will find this entirely natural and comfortable. But this mind set requires confidence – confidence that your abilities are worth the fee you need to charge. To sustain this confidence and long term client connections requires a ready acceptance of the need to market a process. The advisory process is important to clients, provides reassurance and is a critical step to leaving behind the world of transactions.

  • Selling the relationship. Some are now starting to avoid the ‘s’ word – we think that’s misguided. Selling skills are still paramount as in truth they are in any professional service. It’s just that the key sale is of the relationship and of the fact that continuous involvement is likely to be required. Without continuous involvement with a client the new financial model just doesn’t work. And ideas such as passive trail are also now mere parts of history. In other words, continuous client involvement has to be earned.

  • Surveys are showing that clients are not keen on retainers, and prefer a defined cost for defined work. In practice most firms are planning to charge a percentage of funds so there is an apparent mismatch there. But the truth is that most clients will be comfortable if they can see real value – so the job of the adviser includes the ability to persuade the client of this value and then deliver long term. The key characteristic that emerges from all this? Personal credibility.

  • Team orientation. This quality is likely to be more in demand. With greater complexity not everyone will be equally skilled in every discipline, so greater team based cooperation will be required. For example, some firms are operating with fewer advisers and larger teams of paraplanners so the adviser needs absolute trust in the whole team. 
  • Commitment to organisation. You might say this is nothing new but the adviser is going to have to be more disciplined when it comes to the working week. You will need to be crystal clear when your time is “billable” and when it isn’t. Dare we say it, but it’s just possible that revenue might be harder to come by. Many firms, even those with strong fee based business, still retain some reliance on commission. In particular, firms and individual advisers have benefitted from odd large cases which pop up from time to time and effectively cover a monthly target. In future, revenue flows are likely to be much more regular, which is a good thing but will require organisation and discipline.

  • Harder work. This connects with the last point but we are finding that firms want to be certain that prospective advisers are prepared to commit to a high level of sustained effort.

So, the specification for a 2013 ‘Model Adviser’ is not a complete rewrite. It’s about emphasising the way that the advisory role is developing. Our advice to anyone in the sector, who is already Level 4 qualified and looking to make sure they remain in demand is as follows:

  • Be open to further professional development
  • Be confident you are worth the fee you need to charge
  • Keep selling – sell the client relationship
  • Personal credibility – have it or develop it
  • Be committed to being organised
  • Play for the team
  • Be ready to work hard(er)


James Walker - Director - BWD Group

Recruitment - BWD Search & Selection
Training - BWD development 

[This is a sponsored article from BWD Group]



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Author: IFA Life Sponsored Post
Posted: Friday, October 12, 2012 | 8:06:28 AM

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