With financial advisers short on time, many are opting to hire someone to take care of some of the greater demands, both regulatory and financial, that they are experiencing these days.
Paraplanners are no longer seen as support staff that do the technical work in the background but are now involved in research, report writing and tax calculations. They tend to not deal directly with clients, however, as a financial adviser does.
Those who have achieved a certificate in paraplanning from the Institute of Financial Planning (IFP) can call themselves accredited paraplanners; this qualification has consequently given the paraplanning profession a massive boost. Here are some benefits and drawbacks of hiring a paraplanner.
1. Paraplanners can help to generate revenue for the business and can even boost income by 30 to 40 per cent. While some advisers dismiss paraplanners as not generating revenue, others have been able to harness their value to boost profits.
2. Financial advisers have more time to meet with clients. Paraplanners are able to pick up more on the technical side of things, leaving the adviser with more hours in the day to do extra work.
3. The cost of hiring a full-time paraplanner can be expensive. Some can earn up to £50,000 a year, occasionally more than the actual financial adviser. Alternatively, you could use an outsourcing firm which are generally more flexible, however it ultimately depends on the amount of work needing to be done.
4. Support staff are no longer a luxury for wealthy firms. Smaller firms are also able to employ paraplanners. Outsourcing firms make it possible without hiring a full-time employee and additional staff can make the business more profitable if costs are managed.
5. They can become the adviser’s critical friend. In-house paraplanners can help to develop long-term relationships with the adviser or firms to handle all of their needs and therefore create a better working environment.
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