A back to the basics on inflation and what it means for paraplanners.

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A deep dive into a trust deed and the information and points paraplanners should look out for.

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A festive wrap up with a paraplanner quiz to boot.

At the beginning of 2021, we asked paraplanners where they’d like us to focus this year. ESG was in the top five topics requested by paraplanners. So, we ran an ESG special in August and included it in our national event, the Big Day Out of this World.

At both events, we were joined by ESG specialist, Rebecca Kowalski. Her passion and knowledge of the topic helped breath life into the subject.

Rebecca has since set up Overstory – a consultancy with the aim to equip people with the tools, materials and communications they need to have conversations about sustainable investing with clients.

Meeting so many paraplanners at the two Paraplanners Assembly gatherings this year, has given Rebecca food for thought and she shares her thoughts here.

Over to Rebecca….

From Outerspace to Overstory

I had a really great time talking to Paraplanners about ESG at the Paraplanners Assembly “Big Day Out of the World” in September.  Over the last couple of years, with my former employer, my career path has launched me to Planet Compliance and Planet Sustainable Investment and Paraplanning was beginning to seem just a distant star in the sky.  Talking of stars however, I have a lovely shiny one on my window sill, in the form of the Paraplanner of the Year Award 2008, which is how I first met Richard Allum. Yes, I have been orbiting in the Paraplanner galaxy for that long! There have been other awards since then, but that first one always shines the brightest.

But back to the present and the Sustainable Investment mission has in fact been so successful that I ended up on a solo journey and decided a couple of months back to launch my own business, Overstory Finance. Sustainable investing has really gripped me and after over 25 years in financial services, I have never been so proud and excited about what I do.  My former employer encouraged and appreciated my enthusiasm for the subject and noted how it made things happen in the business, rubbing off on colleagues and clients and bringing in recognition for the firm’s sustainable investment portfolios. We were in fact planning to go where no IFA had gone before with the proposition. However, ownership of the business changed and I decided to thank them for their support, wish them all the best and take a small step for the planet and a giant leap for my career development by steering my own ship into the unknown.

Reach for the Tree-tops

So, here we are on the good ship Overstory.  If you don’t know (as I didn’t, until my husband made me read his “tree book” earlier this year –  “The Overstory” by Richard Powers), Overstory means the forest canopy, the tallest trees that grow higher than the others to reach the open sky.  Given I have been affectionately called the office “tree-hugger” in my time, the tree theme appealed to me and also, all Paraplanners like to tell a good story, right?  I haven’t finalised my official business mission statement yet, but the unofficial version would go something like this:

“Determined to use our sustainable investment knowledge, experience and passion to make the biggest possible difference to the financial services industry, to client experience and to the world we all share. Feel good finance for a finite world.”

In practice, this means that I aim to share and put to good use all the hands-on experience I have had, all the huge amount of learning I have done and all the ideas I have chased around my head at midnight through the long months of lockdown.  I have spoken to a lot of FS people about the barriers that deter advisers from embracing sustainable investment and have identified a number of ways in which I can help remove these.   These services will all be listed on my web page which is coming soon.

The Overstory Guide to Sustainable Investing

An early chat with a very kind sustainable investment idol of mine, Kaisie Rayner, got me thinking about writing some training/ learning materials and this idea was re-ignited at the Paraplanners Assembly Big Day Out of this World. Getting the chance to speak to so many people in a small space of time, I realised that there was a real appetite for knowledge about how to do ESG, ethical and sustainable investing well among the Paraplanner community. This shouldn’t of course be any surprise to me, as I should know from experience that no-one likes to do things well more than a serious Paraplanner!

After taking a slightly hell for leather, scattergun approach to building expertise in sustainable investing and matters related to it, I think I can make it easier for people in the financial advice profession who wish to understand the underlying themes, the investment strategies, the regulations, key issues and debates and suitability and compliance considerations relating to sustainable investing.

Having studied and gained some useful knowledge from the CFA Certificate in ESG Investing, I am aware that its method of assessment is very much focused on the role of an investment manager or fund analyst. In my mind’s eye, I see the Overstory guide to sustainable investment advice (don’t worry, a better title will evolve) as focused on the knowledge and practical skills necessary to understand, apply, and explain the theoretical concepts related to ESG, ethical, responsible, sustainable and impact investing. It should cover how to be prepared for client conversations, how to build a robust sustainable investment proposition and how to meet compliance requirements. Crucially for me, it should also take a very honest look at things like greenwashing and the authenticity of all the talk about how much finance can save the planet!  We should ask these questions of ourselves, before either a sceptical colleague or a client raises them.

Roots and branches

Following the Big Day Out of this World, I exchanged a couple of messages with Alyson Brooker of The Paraplanners and want to thank her for the insight she gave me into what type of learning would interest her.  It was really encouraging and informative. I have therefore asked the Paraplanners Assembly if they would help me connect with the wider paraplanning community to explore what you would like a text/ course / training to look like.  If we go back to my tree obsession, lets take a roots and branches approach and then we can all reach the canopy of sustainable investing expertise together.

I have already enlisted the help of Alan Whittle to work with me on delivering the learning materials and we are both keen to start on this rewarding project. Alan is a former Paraplanner and Compliance Officer who now works as a researcher, lecturer, trainer, and provider of external compliance support for financial planning firms.

We would be delighted to gather your thoughts on your learning needs and see what we can do to help meet them. Please answer 12 simple questions here.  

Thanks Rebecca and good luck with your new venture. We’d encourage anyone interested in this topic to share their thoughts with Rebecca.

A refresher on the basics of investing.

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During this session we covered…

A refresher on the basics of investing.

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In this session, we covered…

A deep dive into the Relevant Property Regime

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In this session we covered:

Why are we so beguiled by risk questionnaires? Most paraplanners and advisers use a risk profiling tool as part of their suitability process but are they the right tool for the job?

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Join our paraplanning panel as they discuss how they approach cash flow planning.

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In this session we covered…

Our friends at Aegon are doing a lot of work around financial wellbeing. Dr Tom Mathar, Centre for Behavioural Research, Aegon UK and one of the experts on this online assembly, would like to share some thoughts with you.

Life is unpredictable and changes constantly. But what remains is our need for financial security and peace of mind. And with the rise of DIY platforms and robo-advice breaking through an industry focusing on three things – alpha, asset allocation and charges – the value of advice needs to go further. That’s where financial wellbeing can play its part.

So what is financial wellbeing?

Financial wellbeing is how people feel about the control they have over their financial future – and their relationship with money. It’s about focusing on the things that make their life more enjoyable and meaningful – both now and in the future.

What we focus our mind on matters

Everyone’s idea of financial wellbeing is different – from having enough money to live comfortably, making large purchases (planned or unexpected), to being able to repay outstanding debts, as well as being on track with savings and pensions to cover later life.

But you can easily break financial wellbeing down into two things for your clients:

Financial wellbeing building blocks

We found that money building blocks and mindset building blocks are necessary to build financial wellbeing.

As part of our latest research[1] we asked people about their financial resilience and their ‘mindset’ – how they think about money, and  we created a scale to help clients picture it:

5 money building blocks
  1. Income
  2. Rainy day fund
  3. Manageable debt
  4. Smart long-term savings
  5. Valuables that make us feel secure long term, like property
5 mindset building blocks
  1. Knowledge of what makes us happy
  2. A solid picture of our future self
  3. Savvy social comparisons
  4. A long-term plan
  5. Strong nerves in a crisis (resilience)

But it’s also about balance. Even if your clients have their money building blocks nailed, they won’t achieve optimal levels of financial wellbeing without a well-considered and focused mindset too.

What was clear from our research was that mindset scores were lower than money scores, and the mindset scores didn’t improve at the same pace as peoples’ incomes were.

Find out more about our building blocks and what our research tells us about them in our digital flipbook

Common mindset problems

Lower mindset scores were a result of several factors including:

Five tips to adjust your client’s mindset and improve their financial wellbeing

Use the tips below with your clients to reframe your conversations and check-ins and encourage them to think about what gives them joy and purpose.

  1. Ask them to put happiness first – alert them to be conscious of the things that give them sustained happiness – be that joy or purpose. And that they’re spending time, energy and money on those things with their future happiness in mind.
  2. Savvy social comparisons – if they’re making social comparisons, encourage them to be healthy and realistic, instead of them comparing to people whose financial lives appear better. Or even suggest they use their past self as a comparison to measure how far they’ve come.
  3. Help them picture their future self and lifestyle – encourage your clients to spend time regularly visualising their future self and what they might be doing. By paying attention to the life they want to live, pension and investment goals to achieve that lifestyle, can keep them on track. It’s also important for your clients to think about what protection they have in place if something unexpected derails them.
  4. Make a long-term plan together and write it down – people who write out a financial plan save more regularly and do better financially.
  5. Reassure them to hold their nerve in a crisis – if your clients are tempted to change their long-term investments, get them to remember why they started saving so they don’t panic and do anything they might regret.
Get started

We’re committed to working with you to help identify advice opportunities and support your clients throughout their lifetime.

To read our research in full and share with your clients, download our digital flipbook – How you can improve your financial wellbeing

We’ve also created a summary guide of the research – Our insight into the nation’s financial wellbeing – designed especially for intermediaries, paraplanners and employers.

For other financial wellbeing support and research, visit aegon.co.uk/financialwellbeing

[1] Research conducted in August/September 2020, based on 10,466 nationally representative UK residents