Servicing the mass market effectively is a tricky issue for financial advisers. However, Chapters Financial director Keith Churchouse talks to Helen Morrissey about the launch of a new website that could have a huge impact on how the mass market receives advice.
Where did the idea for Saidso.co.uk come from?
The idea came to me back in 2006 when I was driving through Bracknell. The Met Office, which was based there, was closing and I started to think about what would happen to the people who used to work there.
It made me realise that connectivity is changing the way we work – for instance, more and more people are working from home now. It also made me think about how people access financial advice and how far they are willing to travel to see an adviser.
Computers have become the norm in every home and classroom, and young people are wired differently to older people as a result. Computers are part of their lives and I feel that if the financial advisory industry is to survive, then it needs to make this transition. So we developed a site called MoneyMadeSimple about eight years ago.
To be honest, it hasn’t worked so far. But we need to look at why. I genuinely believe that someone is going to be able to make this work – it is just a matter of time. It may not even be a traditional financial company. It could be someone such as the AA, RAC or Tesco – firms with significant distribution and databases.
So far, regulation has not really been behind supporting a new method of delivery. But post-Retail Distribution Review (RDR), the Financial Conduct Authority is keen to involve alternative ways of delivering financial advice, so we feel that now is the ideal time to revisit the site.
It has cost a lot of time and money, but it was looking a bit tired. So we have revamped it and rebranded it as Saidso.co.uk. The plan is to launch the site in mid-December.
How will the site work?
We have tried to make the site young and fun, and we employed marketing and web designers to help us to appeal to the 25-45 age group. We want the site to be friendly and approachable while still meeting regulatory requirements.
It is aimed to be an online delivery of the service you would get from a financial adviser. For a fixed fee of £299, the client will get a report delivered to them with recommendations based on their circumstances.
This is done through a simplified fact find, which looks to determine things such as attitude to risk and what the client wants to achieve.
We then take the fee and they submit their form to us securely. We then have everything we need to deliver the report within ten working days. If they like that report, they can pay a second fee of £125 for us to go and implement that advice.
If they want a review at a later stage, then we can do that for them too – so we are able to deliver advice, implementation and review all for a fixed fee that is compliant with the RDR.
Right now, we are working with web developers on the site as well as a compliance company to ensure we are within the regulatory standards. We hope to soft launch over the Christmas period and I have no doubt that the response we get will show us where the gaps are in the service that need to be filled.
What have you learned from the whole process?
The key thing we have learned from this is simplicity. We come from an era where advice does not really have a good reputation and we can all think of past pensions debacles. However, many of those who remember these things are starting to retire now and are not necessarily the target market for something such as this website.
The people coming through now have had little guidance on financial advice and so don’t really know what to expect. What they are used to doing, though, is using aggregators to do banking or insurance. It is a slicker process that we wanted to try and replicate, but we needed a platform that is simple in its use and questioning.
That has been the biggest revelation for me: looking outside of the financial services arena to see how they deal with things. With this in mind, we need to look at whether people still expect advisers to deliver advice face to face. While there will still be demand, I don’t think it will be as much as now.
Are there other advisory firms also operating in this space?
Rhetoric and actions are two very different things. Some advisers say they are doing this. But when you look a bit more closely, you see that what they are offering isn’t online advice. It is more along the lines of "give us your details online and we will give you a call".
It is still very much in its incubation period, but I would welcome competition in this area. I feel that in ten years’ time, we will see ten very large financial aggregator sites serving the middle market sector left by the RDR.
How do you expect the service to evolve?
There will need to be some evolution with this. One of the worst things that could happen here is that it works. If it really took off, then a small firm such as Chapters would not be able to cope with demand.
We would either need to expand rapidly or close the site for a while. So my objective for the site is to get it to work, get some accounts behind it and then sell it. It would be an attractive proposition and a larger distributor might well find it of interest.
If you can stack it high and sell it cheap, then there is profitability to be had. Profits is not a dirty word and by going down this route, you are accessing the middle market, some of whom could become high net worth clients in years to come. I feel that whoever is seriously playing in this game stands to do really well out of it.
How do you see the advisory market evolving as a whole as a result of these shifts?
Over time, we may well see there is less of a need for financial advisers and more of a need for good quality paraplanners. I think in a low cost, high volume world, we could see a real growth in the paraplanner world with advisers signing off the work they have done.
Paraplanners add great value to an advisory business and I think we underestimate them at our peril. I see no reason why they should not be earning £100,000 per annum for their work in years to come.
It is great to get the middle market engaged with financial advice as I feel we have alienated them in the past. I feel the next 15 years have the potential to be even more exciting than the past 30 have been.
The RDR is done now and the future looks rosier, so we can accelerate away. We haven’t even begun to fully embrace the technology available to us yet and there is so much more we can do.
CV: Keith Churchouse
• Chapters Financial Limited was created in 2004 by Keith to deliver quality financial planning advice
• Keith is a Fellow of the Personal Finance Society (FPFS), by examination from the Chartered Insurance Institute (CII)
• Keith is also a certified financial planner, chartered financial planner and has a BA (Hons) degree in financial services (QCA level 6/ RDR compliant)
• Keith was the fourth adviser in the UK to achieve the certification of BS ISO 22222 Personal Financial Planner (Standards International) and has completed this assessment for five years in a row (2012)
• As a former accredited Resolution member (2007-12), Keith has undertaken much financial planning work in divorce situations, providing advice on pension division and sharing, among other topics
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