When we think about ‘next generation’ firms we think of those looking to innovate, deliver improved client engagement and drive higher standards throughout the profession.
Common ways in which firms do this include:
- Integrating better technology to help automate the manual parts of the advice process so that advisers can spend more time focusing on the client and their individual goals and objectives.
- Implementing training and development schemes to encourage younger professionals to join an ageing profession and encouraging higher standards by completing Level 6 and Level 7 qualifications giving individuals Chartered or Fellow status.
- Offering clients access to new, relevant products and investments with competitive charging structures and focusing on new ways of engagement.
- Finding modern ways to talk to and listen to our clients using technology.
Throughout the industry there are many firms with archaic systems and processes that concentrate heavily on selling investments and products with high charges rather than building personal and long-standing relationships with clients by understanding what it is they want to achieve.
Historically there have been examples of poor practice within some firms that has led to unsatisfactory client outcomes and damaged the reputation of the financial advice profession.
This has led to the financial advice profession championing change.
New entrants are now completing financial planning qualifications and aspiring to become financial planners, where everything is client centric to deliver rewarding, positive outcomes through an evolving ‘life plan’.
At OpenMoney, we want to take this responsibility one step further
It’s undeniable that better technology, training and development, higher standards of qualifications and more appropriate recommendations deliver better client outcomes. However, the people that benefit from this are current clients or new clients who fit specific profiles with a certain level of wealth.
For too long, individuals have been priced out of the market when it comes to receiving regulated financial advice. Our latest Advice Gap report shows that an estimated 6 million people in Britain wouldn’t get financial advice unless it cost less for them. Furthermore, 20 million people in Britain people feel they would benefit from free financial advice if it was available. This highlights the need for more accessible, low-cost, advised services within the industry to better serve the wider market rather than purely focusing on how to improve the experience for current clients.
At OpenMoney, we passionately believe in helping the under supported segment of the market, which is why we are striving to implement our mission of making financial advice affordable and accessible to all.
We do this by combining all the characteristics outlined above but have put a greater emphasis on creating innovative technology that can provide automated recommendations to our clients using sophisticated algorithms, while still being client centric and focusing on individual goals and objectives.
To support the technology, clients will also have access to qualified financial advisers and mortgage advisers at a time convenient for them.
We are committed to closing the prevalent advice gap in the UK and our own strategy for this covers:
- Technology: We realised that we were advising 70% of our new customers that investing wasn’t right for them. As a result, we have created a new OpenMoney app which is positioned at educating individuals on the importance of paying down debts and building up an emergency fund before having short, medium and long term savings goals. This allows us to help individuals in any stage of the financial lifecycle from debt through to saving and investing.
- Recruitment and higher standards: We have successfully hired and onboarded three apprentices, five trainee advisers and two compliance officers in the last 18 months. Of these members of staff, five have passed the DipFA, all three of our apprentices have passed their qualifications and we have four advisers working towards Chartered status.
- Offering: We have created a hybrid offering that combines technology with human financial advisers to provide advice to the masses at scale with no minimum investment amount and annual fees of no more than 0.50% based on our current charging structure which is inclusive of advice, platform, product and fund costs. To date we have provided financial advice to over 50,000 clients.
During the interview for why we deserved to be awarded Next Gen Adviser Firm of the Year with Money Marketing, we were asked this question, “What message would it send to the wider industry if you were to win this award?”. Our answer was clear.
We emphasised that where our product range at the moment could not fully satisfy an individual’s needs for more complex advice, then we would have no problem recommending the services of an independent financial advisory firm be used.
Combining OpenMoney with next gen advisers can help address the advice gap and make positive changes not only to the profession but more importantly, to our clients' lives.