We all love progress and most of us now mainly operate using wraps, platforms and fund supermarkets.
We all know that there are differences between a fund supermarket and wraps / platforms, but consider how many clients could explain the difference.
The issue to consider is that we may be, like so many other areas of financial planning, beginning to get bogged down in more terminology.
For example, for ‘Oeic’ accounts, we have Personal Portfolio Accounts and – my favourite – ‘General Investment Accounts’ or GIAs, which sounds like a new Ford car model.
To be fair, fund supermarkets, while still around and active, are kind of the older, more limited version of the wrap.
Wrap is more of a rounded and better-fitting description than platform. The term ‘platform’ may be seen as a more technical term, more in line with internet functionality than what the ‘wrap’ is trying to achieve for the client and their wider financial planning strategy.
Why don’t we agree on one description and stick with it?
Explaining differences in tax wrappers, investments, risk profiles, funds, and charges is surely enough without having to add another level of complexity in the form of descriptions of a tool.
John Jaffray is a paraplanner at The Timebank