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By Michael Trudeau | Published Jul 13, 2012

Branching out into non-advised: Plan Money’s RDR plans

IFA firm Plan Money is hoping to expand its non-advised offering and improve record-keeping to more demonstrate the effectiveness of its services and retain smaller clients in the post-Retail Distribution Review world, according to company co-director Peter Chadborn.

Three-adviser firm Plan Money aims to retain its independent title post-RDR and to continue its model of sharing specialisations among its advisers.

“On paper we are very typically-sized. We have three advisers and are holistic in that as a team we cover all areas of advice,” says Mr Chadborn.

“We adopt a team approach because it isn’t possible for an adviser to be expert in everything. If we have to we will outsource work to very specialist partners, for example motor insurance.”

Non-advised

One of the biggest changes the company will undergo during the regulatory upheaval is to expand its online, non-advised service for clients who might not otherwise be profitable. This could even stretch to include sales of general insurance.

“Parallel to RDR is our recognition of how the marketplace is changing and has changed beyond all recognition,” Mr Chadborn says, adding: “Gone are the days when an IFA can say this is the area I operate in and if you don’t fit that then be on your way”.

Wanting an online, automated service to complement the offline face-to-face solution led us to think, why stop there?

He continues: “For us it’s more a case of saying how do you want to do business with us, instead of forcing business down a particular channel.

“The thinking of wanting an online, automated solution to complement the offline face-to-face solution led us to think why stop there, why not partner with someone for general insurance?”

Mr Chadborn believes advisers who plan to cut loose small-time clients after RDR are missing out on an opportunity for increasing business.

“About a year ago we sat down at a lunch hosted by a discretionary portfolio manager and advisers. The manager asked what are you going to do with non-profitable clients and most of the advisers there said we will have to let them go.

“There is no cross-subsidy because the RDR won’t allow that. Every firm was saying once we have completed our segmentation process we will have to let go of them.

“They’re missing a trick surely; who are we to say no, can’t help you?”

He is careful to point out that this is not indicative of Plan Money shifting focus to areas such as general insurance. Or at least, not yet.

“Our motivation is so that we can service existing clients, not necessarily to start capturing new clients or as a lead source. That’s stage two if we can have something for existing clients or can direct them down that route we have got a win.

“The secondary win will be if it works very well and starts attracting new clients in. Those that I have mentioned it to have said why not.”

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