[This article was first pubished in our quarterly magazine, ETF Report UK]
There are tens of thousands of qualified financial planners in the UK. So how could we possibly boil that number down to just 10 "top advisers"?
Very simply: those that focus on holistic financial advice and put their clients first; those that are educated in the use and application of active funds and passive funds, or blend the two; and those that know about or use ETFs directly. At ETF Report UK, assets under management matters little to us—having a loyal client base, being highly qualified and having a strong conviction in the merits of holistic planning is what really counts.
At ETF Report UK, there is a long road ahead of us to educate UK-based financial planners about the pros and cons of ETFs, and encourage them to consider these tools as part of their client recommendations. The regulator advises independent advisers in the world of the retail distribution review (RDR) to consider the whole of the market, and ETFs are a valid and growing part of that market.
That doesn't mean we aren't aware of the risks—and there are plenty of risks to consider when it comes to investing in ETFs —but the advisers listed here have discovered that ETFs can be a useful, low-cost and transparent addition to their practice.
Ultimately there may not be one right way to be a financial planner, but we believe these 10 individuals have got it pretty much perfect, and should serve as an inspiration to their peers.
Athena Wealth Planning takes an interesting approach of segmenting clients into those that are "DFM-able"—those with large enough assets to be looked after by a discretionary fund manager—and those of smaller worth, who receive the luxury of hand-picked portfolios by Carrie Churchouse and business partner Colin Enright.
In those in-house portfolios, the two chartered financial planners blend passive and active funds, and for other clients, advocate the use of DFMs—such as Seven Investment Management, Vestra Wealth and Heartwood Investment Management—that use ETFs in their allocation.
"If we have a portfolio of £150,000 or so, we have something between six to eight multi-asset funds blended in the portfolio," said Churchouse.
Clients at Athena undergo an initial discussion of about 40 minutes to establish the so-called soft facts, said Churchouse, before a "discovery meeting, to put meat on the bones." The team then charges a flat fee to put together a report and recommendations for the client. After that, Athena uses a waterfall charging system, depending on the size of the portfolio, and a 1% ongoing fee thereafter.
"There is no such thing as a typical client," said Churchouse, "but a lot of them are successful individuals in their own right, directors of companies, and, believe it or not, a couple of lottery winners."
She notes that her clients who have hit the jackpot are particularly young but "very grounded" and have made wise decisions not to blow all their capital. Churchouse jokes that she has not been inspired, however, to start buying a lottery ticket.
Both Churchouse and Enright hail from RBS, and Churchouse says her team has a "fantastic wealth of experience." When it comes to being a good financial planner, Churchouse notes three recommended qualities are honesty, integrity and a good eye for detail.
"We were lucky to bring £30 million of assets with us, and now we are growing for the future," she told ETF Report UK. The firm was only launched in October last year and has already grown to around £51 million.