Seth’s Blog on Finance

Untying Myself and Becoming Independent

A short time has past since I’ve broke free from the tied distribution model and begun my independent financial advisory practice, and I have already experienced the benefits of the move.

True financial advisory has indeed become possible. With the client assured that he/she is receiving independent advice on solutions from a wide range of product providers, products take a backseat for the focus and effort to be on the financial planning process. Products have never been the most important when it comes to financial planning, but remains the bottleneck for most in the industry. The diverse range of an IFA platform goes beyond just life insurance, be it investments, general insurance, mortgage refinancing, corporate benefits etc. amongst many other solutions for the man-in-the-street or accredited investors. The only bottleneck now is how well I am able to advise my client as an independent and professional financial adviser – no more excuses now.

Having researched and seeked the opinions of many people before making the leap of faith, I had several expectations and preconceived notions. I guess some things cannot be described until one experiences it first-hand, and I think that summarises my feeling thus far moving to this platform. Many of my negative preconceptions were proven wrong.

I am glad to have made my first case rather quickly. It dashed my pessimistic view that I would not be earning much if I insist on doing things in an idealistic and ethical fashion. It proved to be quite lucrative even though there was no conscious effort to make a product sale at all. I discarded previously-taught sales techniques and just focussed on what my client needed and found that there was no need for “assuming close” or “asking yes/yes questions” when you are doing financial planning instead of a product-centric approach.

True enough, I have attracted people seeking true financial advice. Never before had I imagined it was possible to make a cold appointment without making a single phone call or approaching a random passerby on the street, nor that my prospects would take the trouble to visit me in my office where it’s much more conducive than a cafe outside, and take time to seriously go through the Know-Your-Client form which most of the industry patronisingly complete for regulatory purposes.

It’s now all about true to form financial planning. I had this realisation one quiet day in the office, and I was silently astounded by the new role I am undertaking.

I felt even more flattered when two individuals asked me for my hourly fee. I was told before some time back in no uncertain terms that fee-based planning “will not work because nobody will pay”. It was amusing to see an apparently impossible thing happening to me even though I feel that I’m not at that competency yet… Perhaps when I get my Chartered Financial Consultant qualification.

Of course, not all is rosy and perfect with this platform. A common question about my current role and company seems to be, “Why haven’t I heard of this before?” Indeed – why? Many people are ignorant of the choice they have to receive independent financial advice not tied to any product provider. It seems to be a well-kept “secret” in a nation where most citizens have been shortchanged and underinsured by a long-standing, regressive model of distribution. Over time, the general populance has become tied to the inequitably powerful insurers as much as tied agents are. I will put in my effort to evangelize this platform, even if it takes one person at a time.