The Financial Planner Life has something very exciting to announce…
This week marks the launch of The Financial Planner Life Academies. An amalgamation of leading financial planning academies and entry-level opportunities within the financial planning profession.
Check out our very first academy, M&G Wealth and click here if you want to get involved.
Here’s an overview of the podcast episode.
Sam Oakes: I am joined by Tom Hegarty of M&G Wealth and we’re going to be talking about their brand-new Wealth Adviser Academy, attracting new financial planners to the profession.
We have recently been doing some work with M&G Wealth Academy. It’s a fantastic option out there within the financial planning space. I have spoken to multiple companies over the last 15 years, and M&G is one of the academies that I truly believe is solving a huge problem within the financial planning profession, but we’ll get onto that in a bit….
So, Tom let’s begin by telling us a little bit about yourself…
Well, I’m Tom Hegarty, and I’m in partnership Director at M&G Advice. I’ve got around 25 years of experience working in the financial advice sector specifically.
I originally started out as a financial adviser back in the late 90s. And then I moved into working in the provider world working for a few product providers, and then working with businesses that support financial advisers, and help them run their businesses. I’ve always operated with financial advisers.
More recently, I’ve been a lot more involved in bringing new people into the sector and I’m sure we’ll come on to it but there’s a huge opportunity, a very exciting opportunity for people to join the profession, which is obviously a great career choice.
What is M&G Wealth?
M&G PLC is a global savings and investment business. M&G wealth is a wealth management part of that business, and M&G wealth advice is a subset of M&G wealth. M&G wealth is really about the financial planning part of the business.
Why is there a need for a good quality Academy within the financial planning profession?
The number of financial advisers in the UK has dropped over the last few decades. We are now at a point where the number of financial advisers is a fraction of what it was 40 years ago.
The problem that this creates is access to advice, or lack thereof. So, the challenge now is that it’s very difficult for customers to find financial advice.
There are a couple of solutions; One of them is to grow the number of advisers that practice in the sector, and the other one is to make technological improvements to make efficiencies, so each adviser can look after more clients than they currently look after.
There is also an ageing demographic within the advice population with most financial advisers being in their mid 50’s. So you can imagine over the next maybe 10 years, there’s going to be an influx of advisers leaving and retiring from the profession. We need to replenish these numbers.
Existing businesses all need to do their bit to continue to attract new talent to this fantastic profession, and this is how we are contributing to it. Not just for M&G wealth, but for the future of the entire profession as a whole.
Who is the Academy targeted at?
This academy is open to people that want to become financial advisers, not administrators or paraplanners (yet).
What we have done is take all the different mechanisms or routes of how people would join the profession in the past, and we’ve created the most flexible and effective way of doing that.
We help trainee advisers maximise their earnings potential early on and get them up and running quickly. We then spend a long time with them, coaching and mentoring and supervising that individual until we get to the point where they’re fully experienced.
The brilliant thing about this academy is that it’s open to anybody. There are no barriers, really to anybody.
Why do you feel like your academy is different?
T: There are two major challenges with becoming a financial adviser. The first one is the time that it takes to become fully qualified and competent in the role. And of course, during that period, the earnings potential is lower than somebody who is fully experienced.
The second real challenge is if somebody wanted to create and run their own advice business on their own advice enterprise within another business, they’ve got to build their own client base.
We’re dealing with both of those challenges in the M&G Wealth Academy. We’re trying to minimise study time, so you have more ability to earn. We’re also helping trainee advisers build a client bank. We have a very large customer base within the business already, so we can provide leads to the individuals to give them the best chance of building that client bank thoroughly and quickly, which will last them for, many, many years to come.
What skills does someone need to be a financial planner?
T: My own view which I’ve built up over several years now is that there are four main areas of competence skills that make a good financial adviser, and not all of those are covered by the qualifications.
The first prerequisite is that we need to see that the individual has the capacity to learn technical information. In financial planning, there is a fair bit of technical information out there about regulation and product-specific areas. So the candidate needs to not only understand that, they’ve got to then maintain that knowledge as well.
Second, to that is what I call conduct and ethics, we’re in a highly regulated sector. And so, adherence to regulation and compliance is really important. Make sure that documentation is completed properly and thoroughly, and processes are followed carefully. Remember, the client is always at the heart of the business and all the decisions that are made should be for the benefit of helping the client.
The third part is around business acumen and business development. Advice businesses have to stay around for a long period of time for the benefit of the clients. It’s no good if you are not very good at running a business and you go bankrupt after a few years. A great business development opportunity may be to follow a certain type of client or have a certain specialism. There might be certain avenues to pursue so, it’s important to have that business acumen.
The fourth area, which is probably the most important and probably most forgotten about is you’ve got to have interpersonal skills. You’ve got to be able to listen carefully, question probe, and draw sensitive information out with as much empathy as possible. As well as possess an understanding of good relationship skills.
So just to recap on that:
- Technical knowledge
- Conduct and ethics
- Business development / Business acumen
- Interpersonal skills
They are the key competencies that are needed to become a financial planner.
I want to be a financial planner, but I don’t want to take a drop in my salary whilst studying for the exams, what’s the solution?
T: The qualifications can be done on a part-time basis. So, you stay in your job, whatever that job is that you’re currently doing, and you carry on earning what you’re currently earning.
What we expect from the candidates who we take on to the academy would be that they study for their qualifications in their spare time. We’re looking at around seven hours a week of additional workload of learning. We provide a weekly set of assignments, so it’s very clear what the learning programme is.
Achieving those qualifications while you’re still employed means that there is no drop in earnings. You can then stay in your job all the way through to the point where you receive your qualification certificate.
Do you cover the cost of the qualification?
Yes, M&G cover the cost.
The qualification journey is a modular learning programme. We use the CII diploma in financial planning, which is six exam qualifications. We provide all the study materials, and workshops and there are online apps where we can test understanding and do mock questions. It is all funded by us.
What are my options after I’m fully qualified?
The main idea is to become a self-employed adviser either within M&G’s firms or we will support somebody to set up their own business and their own complete enterprise. There are also employed roles available if someone would rather go down an employed route.
What is the earning potential at M&G Wealth?
It does come down to the individual but we would say somebody that we would take through the academy should be earning 25k in year one, 50k plus year two, and then 75k plus in year three and beyond. this is a very conservative estimate, and we expect most people to earn more.
That can carry on increasing, depending on how well that individual does.
As a company, you’re providing leads to these individuals. So, it’s not like you’re coming across and having to start from scratch. How many leads are provided on a yearly basis and how long for?
When a client doesn’t have a financial adviser, we offer them the opportunity to gain advice and we’ll pass them on to one of our advisers. We will therefore be looking to provide 80 leads to a trainee adviser in their first year and then 100 leads in their second year. That could change depending on the availability of leads that we have it’s not an endless supply, and that will diminish over time.
How long is the academy process?
T: We’ve got several stages.
Stage 1: The qualification journey. This will take 15 months from the start all the way to receiving a certificate to passing R01 to R06. At that point, we would then ask the trainee adviser to leave their employment and commit to M&G wealth advice on a full-time basis.
Stage 2: A financial planning foundation programme. This is all the interpersonal skills, the business development bits, the how to run compliant client meetings, how to document things, all those aspects, and that is a full-time programme, which takes a month. So during that period, there is no ability to work on theory.
Stage 3: Understanding our policies and processes. So there are certain ways we do things within M&G Wealth advice. We have certain advice policies, processes, IT systems. So, it’s going through all of those and making sure that the training adviser understands their infrastructure of how they run that business.
On completion of stage three, trainee advisers are licenced to give advice under supervision. At that point, we start providing them with client leads, and they’ve done role plays and they’ve practised how they would interact with clients beforehand.
Stage 4: The journey to becoming a competent adviser (CAS). The client meetings, the approach calls and, interactions with clients would all be monitored closely with lots of coaching and mentoring and development in the background. The journey to CAS we think would be around 12 months.
Stage 5: The supportive journey. Advisers have demonstrated competent advice status and for the next 12 months, we would continue to support them to make sure they are fully competent in their abilities. We would then deem them an experienced adviser, and they are on their own and running their own advice business.
S: Let’s just demystify one thing that comes up a lot and confuses people who want to become financial planners, and that’s CAS status.
T: Competent adviser status can take 12 months and during that period, you are actually still giving financial advice, and you are still generating income.
If we didn’t have it, that could be a concern that the outcomes aren’t quite met properly. Your adviser might say things that they shouldn’t, they might document things that they shouldn’t have done and said, and breach regulatory requirements.
It’s all about fine-tuning and getting better, to the point where you’re a fully competent adviser.
What’s the culture like at M&G?
We have a caring and collaborative community with great communication.
An area of interest we’ve been looking at recently is the number of female influential advisers. Females only take up 16% of the profession whereas our academy and advice businesses are more around 25%, so we’re slightly ahead of the trend.
What we’re really trying to do is support some of our female business owners to really trailblaze and show what they’re capable of. So when females who come to us are put off by this heavily male-dominated profession, we can say, Look, this is what these other businesses have done and there is no reason why you can’t do that as well and no barriers to it.
We would support anybody to join the business. (Obviously, we need to take them through the process of making sure that they are the right type of candidate) but we’ve got a really forward-thinking and innovative culture within M&G and a really exciting future.
How to apply
S: If you want to sign up and go through the application stage which I’ve been told by the candidates, is absolutely exceptional, click on this link. It is a very quick and easy application process. And we’ll put you directly in contact with the guys there at M&G wealth and you can start your career in financial planning.
If you’re an academy that wants to get involved in this exciting movement, you can join Financial Planner Life Academies here.