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'Why I’m moving to an advice-only model'

'Why I’m moving to an advice-only model'
 

Dan Brent, a soon-to-be-former financial planner at Raymond James, is preparing to enter the advice-only sector as a self-employed, one-man band.

Having decided that advice is not about the products and investments peoples' money sits in, but is instead about life planning, Brent will operate a fee-only financial planning service which allows clients to manage their own investments.

Brent plans to be up and running with his new business sometime after mid-April, after he has left Raymond James.

“The longer I've been in the profession, the longer I’ve been talking to clients, answering clients' questions and really helping clients meet their objectives. You quickly realise it's not about the products. It's not about the investments,” Brent told FTAdviser.

“Most people don't come to you and say, ‘well, what is my return on my investments over the past 12 months?’ They just want to know that they're going to be okay.”

For Brent’s clients, 'okay' means having a plan in place so there is enough money once they reach retirement. “It's about retiring for most people.”

Over the course of the pandemic, Brent started getting more questions from clients unrelated to investments. “I just thought, well that is advice-only planning right there. They’re not talking to me about investments or products.”

Brent studied law at university. But soon after he moved to London, he was made redundant amid the backdrop of the 2009-10 credit crunch. A friend then suggested he work with his firm for the summer, a discretionary fund manager.

“I did all my exams. I worked at a couple of firms in London, so I was really cutting my teeth on high-net-worth, city-based individuals who were time poor and asset rich, too-busy-to-talk-to-you people.”

After a while, Brent started to read around financial planning. “We do the diploma in regulated financial planning, but most people aren't financial planners, really. They’re still financial advisers,” he said.

“I definitely got to a point a couple of years ago where I thought, ‘I don't know if I want to just be selling investment products’. You can make a good living doing that and lots of IFAs are very good at it. But it just wasn't sitting with me.”

“Financial planning, lifestyle planning, life planning, life coaching - it all feeds into each other and ultimately, I think that's where the advice sector will go in this country. It will move more into lifestyle planning,” said Brent.

“It won't be quick, but investments will become commoditised. You can go online and do your investments. You can go online and set up a pension. You can go online and get life insurance. You don’t need a financial adviser.