The first Liverpool-based Powwow North West got off to a good start. The room at Tilney was perfect for our get together and the staff were very helpful. Plus everyone seemed to get to grips with the highly technical lifts!
The group split into two tribes – red and blue.
The two topics that Powwowers wanted to discuss were:
‘How to keep reports simple, easy to read, yet spot on from a technical and regulatory point of view’ and ‘What tools resources and technology do you use, and why and how do you get the most out of them?’
Carly led the session on keeping reports simple – first with the blue team and then the red team.
There was lot of debate over the use of templates versus a report-generating system.
The most common approach seemed to be templated reports with either a system in the background to provide the technical and regulatory info to be used as an appendix, or one person allocated to keep appendix up to date.
The ideal for most is to get reports shortened – down to maybe 4 or 5 pages. One Powwower mentioned that the Financial Conduct Authority’s Rory Percival recently spoke about a 5-page report he had seen which was all about the client and he liked it.
One firm had run some focus groups with clients to find out what clients want from reports. This seemed like a great idea!
Quite a few Powwowers said they use Voyant for cashflow planning and that they copy and paste the cash flow charts into the reports to tie in with client objectives. Also, most people seem to use FE Analytics for fund research and might use charts produced in the appendix or main body of a report. All agreed it is good to have some colour and charts to break up text!
Executive summaries are used by some so clients can see at a glance what is included in the report, whereas others like to produce a client-friendly cover letter summarising the contents of the report. Some also use an executive summary for their appendix, especially where it is quite a large appendix to help clients find what they are looking for.
The red team then went off on a bit of a tangent and discussed in-house paraplanning versus outsourced. There seem to be pros and cons with each but those paraplanners offering an outsourced service said they loved the flexibility and the way they can plan work around their family lives.
What tools, resources and technology do you use?
We started the first session by asking each paraplanner to give a brief description of themselves and where they work.
Every company used wraps and the majority of Powwowers agreed that Transact was the most user-friendly, and that the Standard Life illustration tool was clunky and definitely required an upgrade.
We then moved on to cash flow modelling. The two main cash flow modelling tools that we discussed were Voyant and Truth.
Voyant was by far the most popular tool but some people thought that it was too complex and they preferred to use alternative tools such as the Transact Money Map.
Next we discussed back office systems. Many powwowers had experienced problems with Iress’s XPLAN, particularly with data migration from their current back office system.
Next was tax wrapper analysis and which tools are used. Some paraplanners said they didn’t actually carry out tax wrapper analysis but others used the tools provided by Defaqto and Prudential. Prudential also provide a number of other calculators on their website, which are very useful.
For investment bond chargeable gains calculations, we talked about Invidion and how it is a useful tool but is unable to cope with multiple partial surrenders. One paraplanner then suggested using the Scottish Widows tool which seems to be able to cope with more complex scenarios.
The last topic that we discussed during the first session was pension transfer analysis. We discussed Selectapension and O&M Systems and it was fairly clear that Selectapension was the more popular, robust and user-friendly tool.
The second session started much like the first and the topics of discussion were very similar. The only other aspect of the financial planning process which we discussed during session two, which wasn’t mentioned in the first session, was risk profiling.
That brought the second session to a close.
Questions & Discussion
We all then gathered together at the end for a questions and discussion session.
One issue that was raised was the difficulty in researching and carrying out due diligence on AIM portfolios and other BPR qualifying investments. The marketplace is definitely in need of a comparison tool or due diligence service but no one was aware of any.
One Powwower mentioned Kuber which offers access to pooled EIS investments. Not many people were familiar with this but sounded interesting and worth looking into.
We then went on to discuss Brexit.
All agreed it had had little impact on client’s investments or day to day running in our firms. The suspension on property funds has also had little impact as such a small amount of client portfolios are held in property these days. This discussion was definitely not as heated as we had been expecting!
The final issue discussed was compliance support. Some of the larger firms have in-house compliance which they say works well as compliance understands the business and they can discuss issues more openly. Most firms have outsourced compliance and this can make things difficult. It is a challenge to find a good compliance support that is thorough and yet understands your business and works with you.
The afternoon then came to a close at around 4pm. Most went on for drinks nearby where discussions continued.
Since 7IM had very kindly offered to buy the drinks, cocktails seemed to be the order of the day!