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Technology should be 'embraced rather than feared'

 

When it comes to complex issues clients will always prefer face-to-face advice, Fairstone Financial Management’s Peter Savage has said.

Speaking to FTAdviser, partner and chartered financial planner Mr Savage said innovation and technology within the advice processes should be embraced rather than feared.

He explained: "At the moment technology helps in research and processes… and enables me to sit down with the client and deliver solutions in a format that they can understand and see, such as cash flow analysis.

"It also keeps clients as informed as possible [such as] how their plan is up to date and how their investments are performing, through the use of online portals."

This is especially true for educating clients on important issues, such as defined benefit transfers, prior to the advice process.

For example, in 2018, Fairstone Financial Management removed the triage element of its defined benefit transfer process, following concerns by the Financial Conduct Authority that some firms were straying too far into advice.

Instead of triage – where advisers offer an initial steer to clients about a pension transfer inquiry – the company has been giving potential clients access to educational videos on pension transfers, which are supplied by the online video platform Money Alive.

Transferring out of a defined benefit pension is an important one-off decision for clients, and needs to be treated as such, according to Mr Savage.

Mr Savage explained: "We want clients to be as informed as possible about the decision they are making, and on the topic, so that by the time they come to us they are aware themselves that they need to seek advice if its the right sort of route for them to go down.

"We want the clients to be prepared for our meetings so that they are able to ask the right questions and are able to challenge us on some of the answers we give."

Part of the reason why Fairstone moved away from the triage system is the issue of giving clients information without straying into advice, Mr Savage said.

He said: "We want the clients themselves to be educated and knowledgeable enough that they are aware that 'yes I want to make a decision here to seek advice'

"The way we do it is through the use of educational videos and information sheets so that they have as much information without us giving away a potential outcome, which unfortunately the triage system offered up."

He added: "Going forward, I can see technology will free up time for the adviser because it will help processes and that will benefit us as an adviser to spend more time speaking to clients and seeing clients.

"It will allow adviser firms to deal with clients that they may not deem as profitable now and to be able to manage an outcome and give an outcome for them."