In an interview with FTAdviser, independent adviser Anne Pearson has revealed she left her previous firm and struck out as a one-woman band in order to save regulatory costs, due to the way the fee burden was being unfairly apportioned.
Ms Pearson, sole practitioner at Lancashire-based Anne Pearson Financial Planning, told FTAdviser how setting out on her own allowed her to actually lower how much she paid to cover the cost of operation.
Ms Pearson previously worked at Trafford and Houghton, a Preston-based company she helped found. She decided to leave and go it alone partly due to an equal sharing of regulatory costs that meant an adviser could pay a disproportionate amount compared to business conducted.
She said: “Normally how it works is it would be a percentage of commission they would keep to cover your costs, but when we set off with Trafford and Houghton we decided to split the costs between us and not as a percentage.”
However, splitting the costs equally four ways meant it was possible that some advisers would pay a disproportionate amount compared to the business they were doing.
“I was thinking that costs are only going to go in one direction, so I wouldn’t have any control really. I looked at employed positions but didn’t want to be employed again.”
She now works from home, which allows her to cut overheads even further, and is in the process of novating her clients from the previous firm.
“At the moment I have completely cut my costs because my office is at home so I have no travel in and out, there isn’t a lot of time wasted. There are no actual office costs of employing staff.”
Ms Pearson added that turning to adviser software solutions means she can do most admin tasks by herself.
“For the levels of business I write, the [Financial Conduct Authority] fees aren’t as high anyway.”
The full interview will be published later today.
