The Retail Distribution Review created mayhem in some corners of the advice market, but 10 years on the adviser market is slowly moving from an industry to a profession, says Matthew Aitchison.
When Aitchison set up shop in the run up to the RDR, he knew that his firm would be a proper financial planning business and RDR-ready from the start.
Ever since then, Clear Vision Financial Planning has been operating in Bedfordshire, and its owner is the proud holder of both the chartered and certified financial planner qualifications.
In a Q&A with FTAdviser In Focus, Aitchison explains why the RDR was a good initiative overall, and what he might have done differently in implementing it.
There are more and more advisers and businesses delivering a proper financial planning service, but there is still a way to go.
FTA: What was your perception of the advice market in 2011, when you decided to start your own business?
MA: That it was a broadly transactional market based on product sales with a small percentage offering a professional financial planning-based service.
FTA: What were your main considerations when putting together your business strategy given the RDR was around the corner?
MA: I already believed fully in launching a professional financial planning-based service, but we had half an eye on RDR to ensure we were RDR-ready from the start.
FTA: How did you feel about the impending RDR then and how do you feel about it now, 10 years on?
MA: Broadly, I think it was a good thing. It encouraged advisers to tool up in terms of their qualifications and got rid of some of the old-style sales advisers.
It also forced more transparency into the marketplace and made fees more prevalent, dragging lots of advisers into a more transparent world, which is good news for clients.
FTA: What was the best and worst to come out of the RDR?
MA: Best – higher qualification hurdle and more transparency.
Worst – made it difficult for some of the population to access advice.
FTA: Where should regulators/legislators have acted sooner to rectify any unintended consequence brought about by the RDR?
MA: It’s difficult to comment without being in the room to hear what they were doing. Perhaps had feedback from banks that their sales forces would disappear and try to figure out how to fill that gap.
FTA: How has your view of the advice industry changed over the past 10 years?
MA: It’s slowly moving from an industry to a profession. There are more and more advisers and businesses delivering a proper financial planning service, but there is still a way to go.
FTA: Can you identify what the advice industry needs now to continue to develop in the best way possible?
MA: Focus on how to build and deliver a service schedule built around the client's desired outcomes.
carmen.reichman@ft.com
