"Now advisers need to maintain contact with their clients, whilst simultaneously adapt to changes effectively and continue to provide effective financial planning."
Understandably, many of their clients will be feeling anxious about what steps to take and advisers have a pivotal role to play in providing comparable levels of support, albeit in a very different setting.
But it is important to remember that, unchartered as these waters are, many aspects of the day-to-day client relationship management and the supporting processes remain unchanged. And for me there are five fundamentals that still apply when it comes to the provision of financial advice, even in these times of upheaval.
1. Staying close to your clients is key – as always, clients will need constant contact and reassurance, specifically vulnerable clients who may need special attention.
2. Continue to monitor your client’s investment objectives - their short-term goals may be constantly changing and escalating in importance, but don’t lose sight of their long term aims.
3. Remaining aware of your client’s attitude to risk or capacity for loss – short term events could mask the reality of either, but it’s likely that for some, one or the other could change. Clients will likely need reassurance and perspective here – even if some can afford loss, it doesn’t always mean they’re willing to accept it.
4. The fundamentals stay the same - Despite the unprecedented situation, strong financial planning, appropriate use of tax wrappers and planning for the new tax year (amongst others) continue to remain vital.
5. Always remember – it is time in the market that counts, not trying to time the market.
Of course, despite the above staying the same, the current environment demands a renewed focus. And the continued UK lockdown has certainly changed how advisers engage with clients. Now advisers need to maintain contact with their clients, whilst simultaneously adapt to changes effectively and continue to provide effective financial planning.
As I see it, these are the five moving parts of the jigsaw that are affecting advisers:
1. Changing ways to contact clients – with so many potential ways to keep in touch, its important clients know the easiest way to contact you. It helps to offer a range of options, whether that be via Skype, Zoom, phone-calls, newsletters or social media. Sounds obvious, but make sure your clients know that you remain open for business and accessible.
2. The Tapered Annual Allowance – the changes could mean some clients can now pay significantly higher pension contributions. The ‘top-up’ through tax relief could mean that clients are able to recoup their investment losses; or even get a head start on market recovery.
3. Providers are changing – this will make remote working and new and existing business processes easier.
4. Deferrals by the FCA - the FCA have deferred several important items on their agenda, including: Investment Pathways, the policy statement following on from CP19/25 and PTS qualifications.
5. Use video to be your admin ally - with the rise of video conferences and other recorded meetings, use this to clearly document clients understanding of the advice given.
Regardless of the constants that exist alongside this period of change, what is true is that this is – to coin an over-used term – an unprecedented time we are in. And I know advisers, like all of us, are doing their very best to adapt to it. We’ve rallied through market events before and we will rally again.
