Paul Lewis has written an article that has annoyed many IFAs. You can read it here. If you haven’t read it, you might as well now, as most of this article will only make sense if you’re familiar with Paul’s intent.
Paul Lewis chose to publish it in Money Marketing, which is mainly read by IFAs and those who use IFAs to distribute their product. The article has been placed to cause maximum disruption, the journalistic equivalent of farting in a crowded lift.
The article has succeeded on a number of levels. Comments from IFAs have been numerous and all have been uncomplimentary to Paul and his article. It has disrupted IFA BAU. Why is it so annoying?
Firstly, it has not actually said anything, but it has implied much – the reader has been left to draw his/her own conclusions but it’s clear that Paul Lewis thinks spending £700 on ancillary services to the purchase of an expensive washing machine is akin to spending £700 on advice around an expensive financial services product. To compare IFAs pricing model to a plumbers has annoyed IFAs but as Paul says
.@NotThatGrumpy @stettip >> I don't see it as demeaning. And not one plumber has complained!
— Paul Lewis (@paullewismoney) June 5, 2015
Secondly it has required IFAs to look at themselves from a shared perspective to their customers. I think it very likely that those who pay for financial advice buy top of the range washing machines just as they buy pricey financial products. looking in the mirror, IFA’s don’t like what they see – and that hurts
Thirdly, Paul Lewis’ analogy is substantially apposite. People end up paying a lot more for financial services than they thought they would do and it’s because of the hidden extras within the advisory contracts (and often within the product servicing contracts).
Paul paints an extreme picture for effect, the mirror may be a little distorted but do they think he’s any kinder on bankers, accountants, lawyers and actuaries?
The article is quite funny, I can imagine Paul at his computer grinning. I am sure he anticipated the outraged comments that have accumulated around it and I’m sure he’s grinning at those too.
I was an IFA for fifteen years and still see myself in the game, albeit a stage removed. The picture Paul paints is a grotesque but it’s recognisably me. And for me to think that because I’ve got “actuarial” in my title, I’m exempt from criticism would be even stupider than to say Paul is wrong!
So these lessons are for me as much as for those who are overtly criticising the article and Paul. I’m not beating myself up – I’m gently smiling.
Lesson one
Never take yourself too seriously! It is a sure sign of the insecurity of financial advisors that they consider this an attack on them. It is not- it is an attack on IFA behaviours- or at least the bad behaviours.
Lesson two
Never mess with a good journalist, they have the Klout – quite literally. Paul Lewis is a massive influence, more influential than any IFA, right up there with Martin Lewis and Ros Altmann as a consumer influencer. He didn’t get there for nothing, more people trust Paul Lewis than trust any IFA!
Lesson three
Learn some humility, the man’s right and it’s worth learning from him. The majority of most adviser’s time is spent gaining people’s confidence – it’s called prospecting. Paul Lewis has people’s confidence and can spend all of his time advising- and being listened to.
I sit at this man’s feet, as I do the feet of Altmann and Martin Lewis and ask myself, what are they doing right , that I have been doing wrong?
Lesson four
Be thankful.
I don’t know what Paul Lewis got paid for the article but I’d be surprised if any IFA paid to read it. The reason Paul placed it in a trade mag was for the improvement of the trade. If Paul had placed this in the Mail or on a BBC blog then there might have been cause for grievance – after all the article is deliberately oblique, you only get the points he makes, if you are in the know about IFA pricing,
Paul Lewis is doing IFAs a favour. If IFAs don’t get that, then they are doing themselves no favours.
Agree with every comment, Henry. Shooting and messenger come to mind!
When you can’t take some constructive critical comment you’re out of touch. As an industry we need to continually focus on how we can deliver what our clients are after. It shouldn’t necessarily be the cheapest service but it should always be good value.
Paul Lewis portrays the process as a product driven way of advising an individual, which to be fair is the majority of “advice” that is given within the industry. You have a pension problem which needs advice and this is how much it costs… Times are changing and individuals require much more than this (financial planning) which people really don’t mind paying for…
And just imagine how frustrated the washing machine maker is that he cannot advertise directly to the public.
Just as I wouldn’t want to be a member of a club that would have me as a member, I think IFA’s that are ethical and successful (the two usually go together over the long run) need to stop associating themselves with the label ‘IFA’ or ‘Financial Adviser’ and call themselves Fiscally Advantaged Retention Technicians.
I agree with Paul Lewis in fact about 2yrs ago on his Moneybox show the subject of charges on Pensions came up. They had worked out 25% of a pension fund value over 25yrs would be taken in charges. And what do we wake up to this morning, product providers preventing consumers cashing in part of their funds without going or taking some form of advice or paying a penalty.
I agree consumers should be advised on these matters but its up to them what they want to do.
The industry should be ashamed of it self because from the consumer point of view all they can see is the industry are still playing the same old tricks in trying to get more money.
When will the industry put the consumer first !!!!!!!