Financial advisers must give clients confidence during the current financial and economic turmoil or risk losing them, Britain’s top wealth experts have warned.
Disruption in the markets means that it is not enough for advisers to focus on technical and specialist products – a broad range of regular contact with clients is essential, especially after the Bank of England warned last week that there was a “material risk” to UK financial stability.
That sentiment is echoed among firms featured in the country’s top advisory businesses, compiled by FTAdviser, the FT’s specialist publication for the sector.
“Failure to engage with clients is what’s historically wrong with financial services,” said Jessica Ayres, a financial planner at Timothy James & Partners, one of the firms on this year’s FTAdviser Top 100 IFAs list.
Customers have been calling incessantly recently because they’re worried about what the rising cost of living will mean for their money, he said. “Most customers want to know what we plan to change [in investment portfolios] cope with persistently high levels of inflation.”
Not being there for clients to discuss “everything from mortgages to investments” risks “alienating” them and could lead to losing a client, he said.
To view the FT Adviser IFA list, visit 2022top100.ftadviser.com.
In the past few weeks, most of the conversations at Quilter Private Client Advisers have revolved around “reassuring clients”, according to Sarah Waring, director of financial planning.
This confidence extends not only to the client, but also to their families. “Families come together when times are tough, and we want to help counselors help financially to make sure that every member of the family is in the best possible situation,” Waring said.
Neil Padgett, chief executive of IFA top 100 firm Alexander Grace, says his advisers are willing to take on any topic raised by clients, even if his firm doesn’t specialize in that area, because the client must come first.
He said, “We’re here to help our clients and tell them why we don’t offer something, or find out it’s something we don’t understand, or bring in another professional with experience.”
Ayres also said clients were asking whether they should stop taking income from their pensions and investments, fearing the value of their funds would be reduced when market indicators could work against them. He said the answers depended on the client and their situation: “My job was to explain as much as I could, make sure they were in a good financial position and put them at ease.”
There were many disturbing situations. This year witnessed Russia’s invasion of Ukraine; cost of living crisis; the sinking of the good ship sterling and a raft of tax changes known as “Trussonomics” forced the Bank of England to make a remarkable, if temporary, U-turn on quantitative easing.
The top firm in FTAdviser’s Top 100 IFAs is Johnston Carmichael Wealt, Scotland’s largest firm of independent accountants and business advisers. Next is Mazars Financial Planning, a division of Mazars, a diversified accountancy firm based in London. The third is financial planning company Punter Southall, which grew out of pensions consultancy.
The FTAdviser list is based on data from ISS Market Intelligence business Financial Clarity, which compiled a long list of 150 companies selected by total sales to June 2022.
In selecting the final 100, credit is given to other quality factors, such as how long the firms have been in business and whether they have been accredited by the Chartered Insurance Institute or the Chartered Institute for Securities & Investment. Seven of the top 10, as well as 17 of the top 20, have charter or accredited status.
Of course, there are more to choose from than FTAdviser’s 100 companies. This year, the Financial Conduct Authority found there were 43,326 advisers qualified to give retail investment advice in the UK.
FTAdviser List A snapshot of the UK advisory profession: major networks, national businesses and local operations. Because every client’s needs are different, every company is different. The full list can be found on FTAdviser.com at: 2022top100.ftadviser.com.
Simoni Kyriacou is the editor of FTAdviser