I have read a couple of articles in Money Marketing over the last few weeks, the most recent being in this weeks issue which came from research conducted by Owen James saying ‘Paraplanners double business profitability for IFAs’.
When I read this I leapt up and down and shouted with joy as this is what a number of people, including myself have been trying to get across to the industry for years.
This really shouldn’t come as a surprise though! If IFA’s and firms think about it, using a paraplanner rather than increasing the number of registered individuals, will obviously increase the profitability of a firm.
The cost of a paraplanner is much less then that of an adviser and if the adviser has the skills that they should have, those being the ability to talk to clients, to question clients, to understand a clients needs, to be able to discuss a clients objectives, the ability to establish a clients true goal in life and relate all of this to a proper, professional and compete financial plan, then the adviser hasn’t got time to be in the office doing all the things a paraplanner should be doing.
I have always tried to explain that the skills of an adviser are not the skills of a paraplanner and vice versa. Yes there is a lot of crossover; yes some advisers can do the job of a paraplanner and similarly some paraplanners would make excellent advisers. However the main strength of an adviser is the client relationship and the main strength of the paraplanners is that of technical research and report writing.
Put both of these together and you have a winning combination.
It does appear though that some firms still do not see the benefit of employing more paraplanners rather than advisers.
A paraplanner can add so much to a business which should complement the adviser. Having a paraplanner allows the adviser more time to do the things they are good at but not only that a paraplanner will bring to the firm many more skills and experiences that an adviser may not have.
Hopefully, as more and more IFA’s and large companies read articles in the press and more and more paraplanners contribute by showing their knowledge and professionalism the industry will come to realise the numerous advantages employing paraplanners can have and the many and varied benefits they can add to a firm.
But I guess I would say that wouldn’t I?
