The Spectrum IFA GroupAmsterdam Luxembourg Lausanne Paris Cote d’AzurBarcelona Madrid Costa Blanca Costa del Sol RomeWith ...
Michael LodhiCEO The Spectrum IFA GroupBoard Member of FECIFFédération Européenne des Conseils etIntermédiaires Financiers...
The Future of IFASWhy IFAs are now more importantthan ever for the EuropeanConsumer
What is an IFA?• Independent – wide choice of product• Financial Adviser• Investment Adviser• Financial Planner• Insurance...
New EU & National Regulation• Does the European Commission understandthe impact of more regulation on SMEs?• The cost of r...
New EU & National Regulation• Do the Commission & Politicians understandthe importance of European Citizens investingfor r...
The Consumer• Are they proactive?– Retirement Planning• DIY investing?– 1990’s to March 2000 – Day traders• Education?– Wh...
UK Financial Services Authority (FSA)study of UK Bank advice (mystery shopper)• Complex risk profiling resulting in poor r...
UK Financial Services Authority (FSA)study of Bank advice (mystery shopper)• Failure to give clients correct information(u...
Result of UK RDR – Commission Ban• Banks – Many closing advisory serviceIncreased Training Costs - QualificationsIncreased...
Initial costs for an IFA SME• Cost of qualifications and continuousprofessional development• Cost of Licensing and Regulat...
Quality IFAs & Financial Planners• Know and Understand clients• Understand Client’s goals and objectives• Understand Clien...
Can fee based advice work?• Consultation and Planning Report, shouldthe client pay? Why not a free “test drive”?• Initial ...
The Future• Banks withdrawing from advice market– Will “product sell” without advice• Product providers looking outside EU...
The Future• Independent advice & consumer choice– Dying out• IFAs & Financial Services SMEs– A dying breed• Regulators & L...
The Spectrum IFA GroupAmsterdam Luxembourg Lausanne Paris Cote d’AzurBarcelona Madrid Costa Blanca Costa del Sol RomeWith ...
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CIFA presentation UK

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CIFA presentation UK

  1. 1. The Spectrum IFA GroupAmsterdam Luxembourg Lausanne Paris Cote d’AzurBarcelona Madrid Costa Blanca Costa del Sol RomeWith Care, You Prosper
  2. 2. Michael LodhiCEO The Spectrum IFA GroupBoard Member of FECIFFédération Européenne des Conseils etIntermédiaires FinanciersVice Chairman FEIFAFederation of European IndependentFinancial Advisers
  3. 3. The Future of IFASWhy IFAs are now more importantthan ever for the EuropeanConsumer
  4. 4. What is an IFA?• Independent – wide choice of product• Financial Adviser• Investment Adviser• Financial Planner• Insurance Broker• Distributor of Financial Products• SME (Small or Medium Enterprise)
  5. 5. New EU & National Regulation• Does the European Commission understandthe impact of more regulation on SMEs?• The cost of regulation and of changes tobusiness models• The time spent• Do National Politicians?• Do European Politicians?
  6. 6. New EU & National Regulation• Do the Commission & Politicians understandthe importance of European Citizens investingfor retirement?• Any reduction in advice and services willimpact EU member state’s budgets.• Citizens will need more financial support inretirement from those budgets.• Citizens living longer = costing more!
  7. 7. The Consumer• Are they proactive?– Retirement Planning• DIY investing?– 1990’s to March 2000 – Day traders• Education?– What next? DIY Doctors?
  8. 8. UK Financial Services Authority (FSA)study of UK Bank advice (mystery shopper)• Complex risk profiling resulting in poor riskassessments and client understanding• Failure to consider client needs andcircumstances – poor quality fact finding• Failure to consider client’s investmenttimeframe* Source – Seven Deadly Sins of Bank Advice
  9. 9. UK Financial Services Authority (FSA)study of Bank advice (mystery shopper)• Failure to give clients correct information(unacceptable in 42% of cases)• Inappropriate use of Sales Aids• Inappropriate use of Financial Incentivesfor sales staff• Weakness in internal controls
  10. 10. Result of UK RDR – Commission Ban• Banks – Many closing advisory serviceIncreased Training Costs - QualificationsIncreased Regulatory Costs & FinesIncreased Internal Compliance Costs• ConsumersWill the majority pay for advice? NoWill they get advice? NoWill they rely on the state for Pensions? YesCan the state afford to pay? NO
  11. 11. Initial costs for an IFA SME• Cost of qualifications and continuousprofessional development• Cost of Licensing and Regulation• Cost of Professional Indemnity Insurance• Market and Product research• Cost of Client Acquisition• Who Pays?
  12. 12. Quality IFAs & Financial Planners• Know and Understand clients• Understand Client’s goals and objectives• Understand Client’s attitude to risk• Truly match Client’s needs to solution(s)• Explain all costs and penalties in detail• Involve clients in the decision• See clients regularly to review
  13. 13. Can fee based advice work?• Consultation and Planning Report, shouldthe client pay? Why not a free “test drive”?• Initial Fees will restrict consumer choice• Plan implementation and transactions• On-going monitoring of plans• Personal After Sales Service• Can an IFA make a living?
  14. 14. The Future• Banks withdrawing from advice market– Will “product sell” without advice• Product providers looking outside EU– Withdrawing due to lack of distribution– Or “product sell”• Few new IFAs or start up businesses• Citizens need IFAs for proactivity & choice
  15. 15. The Future• Independent advice & consumer choice– Dying out• IFAs & Financial Services SMEs– A dying breed• Regulators & Legislators– Nothing to regulate• Result– No growth and more budgetary stress
  16. 16. The Spectrum IFA GroupAmsterdam Luxembourg Lausanne Paris Cote d’AzurBarcelona Madrid Costa Blanca Costa del Sol RomeWith Care, You Prosper

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