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How to choose a paraplanner to meet your business needs

How to choose a paraplanner to meet your business needs

There is no denying the rise of paraplanning over the past decade, but in recent years this has led to a sea change. 

Increasing numbers of paraplanners are leaving employment and setting up as outsourcers, reducing the pool of experienced ‘employed’ paraplanners.

To address this, some companies are training their own in-house talent.

However, this is not always practical for smaller businesses.

For larger companies, busy periods mean they sometimes need extra resource.

These factors are driving an ever-increasing number of advisers to work with outsourced paraplanners.

Getting started can be difficult, as changing your business processes inevitably involves giving up some of your valuable time.

Outsourcing can sometimes be seen as an additional expense, with no guarantee it will benefit your business.

So, how do you choose the right provider first time?

The following might help you narrow the field and find a good fit for your needs.

  • Capacity — A lot of paraplanners are fully booked. Some have waiting lists, which might be useful if your need is not urgent, but as a starting point, ask if the company is able to take on new clients.
  • Data protection — All paraplanning companies should be able to provide their GDPR documents, but also consider how your clients’ data is shared and stored. Cyber security is a major business risk, but it can be mitigated, for example, by using secure data transfer systems.
  • Services — What services do you need and does the outsourcer offer them all? Some provide data gathering services, some process application forms, while others focus on the research and reporting. Do you need cash flow planning and does the outsourcer know their way around your cash flow tool?
  • Specialists — Some paraplanning businesses specialise in particular types of complex work, such as trusts or pension transfers. Some only work with advisers from specific networks.
  • Qualifications and experience — If you are looking at outsourcing annual reviews and Isa contributions for example, you do not need to pay the rates charged by a chartered paraplanner. On the other hand, if you undertake defined benefit pension transfer work, does the paraplanner have G60, AF3 or AF7?
  • Templates — Does the company use templates or software to produce suitability reports? Do they need to use your templates, or will you use theirs? How does the company make sure their templates are compliant and up-to-date from a technical perspective?
  • Analysis tools — Do they have their own research and analysis software licences, or will they need to use yours?
  • Fees — some companies charge fixed fees, others work on an hourly rate. Some charge a retainer, which can guarantee they have capacity for your work, whereas others are more flexible and take ad hoc work.
  • Turnaround times — Do they define their service levels? How quickly should you expect your completed work back? 
  • Remedial work — if you need changes to a report, are these included in the initial fee or do you need to pay more?

Lastly, with such a large number of paraplanning providers to choose from, where do you start?

The best option, where possible, is to get a referral.

There are resources, such as paraplannerdirectory.com, which enables you to approach several companies at once, or panaceaadviser.com also has a directory.

Whichever way you go about it, you will not regret making the leap.

Alan Gow is a paraplanner at Argonaut Paraplanning

This column is supported by Scottish Widows