Is Advice Elitist?

There’s a couple of debates raging in our profession where different parties disagree at their core seem to be about one thing….

Elitism.

Elitism – an attitude that states that a select group of people with a certain ancestry, intrinsic quality or worth, high intellect, wealth, specialised training or experience (or any other distinctive attributes) are those whose influence or authority is greater than that of others, whose views on a matter are to be taken more seriously or carry more weight.

Elitism.

A concept which doesn’t sit comfortably with me. I’d prefer a profession where we embody principals which are the polar opposite of Elitism.

Equality and Democracy.

A profession where debate is encouraged, where ideas are challenged but where these conversations, either online, face to face or in the press are conducted respectfully and whilst trying to appreciate other peoples perspective.

A profession where if an individual doesn’t agree with a particular ideas or concepts then the challenge should be to persuade, encourage to explore the alternative point of view, not discounting their opinion because they ‘just don’t get it’.

A profession where we avoid making it personal but instead if we don’t agree respectfully challenge on the ideas and concepts of someones point of view. A profession where we play the ball, not the man (or woman).

A profession where we’re conscious that the huge majority of us have the same goal – To provide a brilliant service to our clients and to build decent businesses but where we all might have different perspectives on how to achieve this.

Maybe I’m being idealistic.

However I can’t get away from the fact that with the entire collective intellectual capital within our profession we’d be better off finding the common ground and working together than creating often artificial petty divisions?

One of the challenges we face as a profession (and as society at large) is the fact that the provision of advice itself is elitist.

The reality is that most financial planners clients are in the top tiers of the UK’s most wealthy. Nice people. People who understand the benefits of what we do. People who appreciate our help.

I also fully understand the reasons (as you will) the reasons that for most financial planning and advice businesses looking after clients who are less wealthy isn’t always commercially sensible.

Dealing with a small number of high wealth clients (per adviser) who can afford a bespoke consultancy based financial planning service makes business sense under the current regulatory regime.

However a brilliant recent article by Lee Robertson (which you can read here) highlights the fact that there’s a significant issue of trust when it comes to ‘financial advice’ together with a perception that for most people we’re too expensive (which for many is probably true).

Now you could argue that for those approaching retirement Pension Wise will provide support where required.

You could also argue that the fantastic work by many in sharing useful knowledge and ideas, more often than not for free, is another route for those who won’t or can’t afford to access our services.

You could also argue that auto enrolment will mean millions will start to save for their financial futures where they didn’t before.

I’m pretty sure the hard work by pension wise, the long term impact of auto enrolment and the individuals committed to sharing knowledge will contribute towards filling this gap.

However I reckon the gap between the support provided and the demand for help, even with everything going on to reduce it, will be hugely significant.

Again maybe I’m being idealistic. Maybe the problem is too wide and broad in scale to solve.

However I can’t help but think about working towards solutions which provide our knowledge and expertise to those who most need it.

I can’t help but think about finding innovative (and commercially viable) ways to ensure that financial planning can delivered more democratically.

and

I can’t help but think about ways we can make our services less elitist….and more equal.

So, here’s my final thought…

How about an environment where the people involved in our profession, although they might disagree, work together to make things better…and what if ‘better’ meant not only better for those of us who chose this as our vocation, or the wealthiest in the land but to ensure we work towards finding solutions which work for us all?

Now that’s a revolution I’d happily be a part of!

What do you think? 

Share:

8 thoughts on “Is Advice Elitist?

  • Great article Chris and couldn’t agree mere. As an industry we focus our efforts on wasting time/breath on non-productive areas (which is ironic given how much is written about efficient business models!) such as who is better a financial planner or a financial advisers? I only deal with clients over £1m and therefore I am a better adviser/planner (see above) than you!

    Alas I do not have an easy (or hard) solution in mind but if your uprising gathers momentum I will gladly be part of the Northern part!

    Reply
    • Thanks Bert.

      I haven’t got a solution either!

      However a collaborative approach where we all try to solve the big problems makes a million times more sense to me than wasting time in pointless conflict!

      Thanks so much for your comment and support!

      Reply
  • Count me in Chris, Bert

    Something I do miss from my village in Aus is that everyone has a pension, and no matter what they do for a living, it’s building up just nicely over decades. Luckily I’m part of that generation, who didn’t know or care about pensions. It just happened.

    That’s why I like being part of Auto-Enrolment, even though it’s far from perfect.

    It’s probably the only solution to deliver low cost advice to more people, but it needs to have more education than, ‘this is your investment return for the year’. Give it a generation, and our industry will wish it paid more attention to these ‘C’ and ‘D’ clients.

    Happy Easter

    Reply
    • Thanks Dan,

      I’m with you in respect of auto enrolment. It democratises saving so that everyone is working towards saving for their financial future.

      It’s interesting. Whilst I fully understand why many businesses segment and categorise clients if you examined the history of ‘A’ and ‘B’ clients they started their savings journey years before (where they might have been categorised as ‘C’ or ‘D’!)

      I reckon if you can find a way to deliver an efficient service to ‘C’ and ‘D’ clients in an efficient way and provide a different service when they build the wealth and become wealthier clients.

      It’s a huge challenge and one I haven’t worked out yet but I reckon it’s a challenge worth exploring.

      Thanks for your comment mate and have a fantastic Easter too!

      Reply
  • I love this piece. True in all respects. When I look at the angry comments at the bottom of articles, especially around regulation from anonymous correspondents I always wonder what clients would think. I cannot image a true profession exhibiting such tendencies.
    In terms of elitism, one small point might amuse. When we looked at tax wrapper optimisation, most advisers told us they had very little money in general wrappers. This included those who say they only look after wealthy clients. The exception were aggregators who had taken over firms that had sold buckets of life bonds rather than ISAs. These two facts beg a couple of uncomfortable questions!
    In the same context, I was told on Twitter by a leading IFA consultant that most IFA clients were not affected by changes to LTA. Odd!
    So two things:
    Advisers should stress what is good, rather than knocking others (there’s enough consultants likemeto do the knocking!)
    Advisers should applaud efforts to expand the advice constituency as much as possible which means more automation and improved efficiency.
    More strength to your elbow, Chris

    Reply
    • Thanks Clive,

      You raise an interesting point about the fact that too many comments, especially many of the negative ones, are anonymous

      It’s also something I’ve never truly understood.

      After all, If you truly believe in the point you’re trying to make, why wouldn’t you put your name behind it? I’m sure there’s a good reason….but one I can’t understand!

      Advisers should stress what is good (and actually so should consultants) but also shouldn’t be afraid to be critical – as long as the criticism is constructive and designed to help share ideas which we could potentially use in our businesses

      I reckon it would be useful…..however the approach taken by some (both in the advisory and consultancy communities) means that we seem to descend into petty squabbling or critisism without constructive comment which isn’t useful for any!

      I also agree that the new models should be considered and when right, encouraged and applauded. The reality is that most of these new models don’t constitute a threat but can actually help advisers build and develop their proposition.

      Thanks again for your comment Clive.

      Reply
  • Hi Chris, however laudable the message I’m not sure how it works. In 1998 I joined an industry, a commission based, product based, provider based world where clients came well down the priority list.
    In 2015 we have an embryonic profession.
    That didn’t happen by accepting that everyone has a different view, it happened because pioneers made it crystal clear that there was a better way to do things. Inherently therefore the old ways and beliefs are wrong.

    Having come to understand 10 years ago what financial planning is and how it answers so many questions for clients I couldn’t ever advise a client without a proper plan and a cashflow. I have never heard anyone with an argument to persuade me to the contrary. Anyone giving financial advice without a plan and a model is simply doing it wrongly.

    When something isn’t right we should say it and when it is, we we should laud it.

    Real change doesn’t happen by pacifying those who don’t see it. It comes by relentlessly demonstrating that there is a better way and being prepared to go out on a limb for what you believe in.

    The world isn’t flat.

    Reply
    • Hi Steve,

      Thanks for your comment but I think it’s important to clarify what I mean….

      I agree that we’re moving in the right direction and as a profession we’re now delivering way more value to our clients using proper plans, cashflow and fairer (as well as more transparent) charging.

      You’ll hear no argument from me in the contrary.

      I’m also not suggesting that being passive is the route we should take. If you believe something is right you should fight for it!

      However pretending that one approach has a complete monopoly on good ideas and suggesting that anyone who doesn’t share all of the beliefs of a particular approach (as well as dismissing and denigrating people who believe something different as ‘not getting it’) as ‘wrong’ is, in my opinion, a pretty patronising approach.

      You’re right to say the world isn’t flat.

      It also isn’t black and white.

      I don’t believe that any one of us has a monopoly on good ideas and try to listen, learn and utilise the ones which make sense to me and what I believe.

      Does that mean that I’m not committed to what I believe is right?

      no!

      Does that mean that everyone’s going to agree with me?

      I hope not!

      However I’ve got a clear choice.

      I can either listen, learn and attempt to persuade or alternatively I can dismiss and denegrate anyone who doesn’t agree (because my approach is ‘better’).

      I know what route I’d rather take. It’s the former.

      You make a point about real change. However real change doesn’t come from either a passive or elitist attitude.

      As for ‘how it works in practice’ there are plenty of examples of how leaders took a more collaborative and less revolutionary approach to get closer to their goals.

      One of the best examples is Mandela in South Africa.

      Whilst starting as a revolutionary, after imprisonment he had decided that he needed a different approach…

      Instead of seeking to divide, he had to unite.

      Instead of pretending his approach was perfect in 1991, when his support was huge, he admitted that some of the ANC’s polcies were fatally flawed.

      Instead of saying ‘this is how it is’ he had to consider other peoples point of views and treat everyone fairly, including those who persecuted black south Africans for years (even granting amnesty for testimony of the crimes they committed).

      Instead of ignoring and decrying the National Party he worked with them, implementing change from within.

      Compare this approach to how Mugabe managed transition in Zimbabwe and tell me again why listening, understanding and collaboration doesn’t work?

      So, if Mandela could fight for a concept arguably way more important than what we’re discussing….why couldn’t the same approach work within any context?

      Thanks again for your comment.

      Reply

Leave a Reply