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The next generation of advisers
The financial advice profession will soon face an adviser shortage, this is not news to those working within the profession, but what are firms doing about it?
Shockingly, the average age of an Independent Financial Adviser (IFA) in the UK is 58. Even more worrying is the fact that one in five of these IFAs plan to retire from the profession in the next five years and COVID-19 appears to be fast tracking those retirement plans for many.
With the burden of regulation that seems to be ever growing, along with the increased qualifications, ongoing education requirements and costs of professional indemnity insurance alike, many smaller IFA businesses are selling up and exiting the market.
As these businesses sell up and the older advisers retire, who will be advising the next generation of savers and retirees or indeed our existing clients? It is estimated that more than 15,000 advisers will be leaving the profession within the next five to10 years, out of a total of 26,600 within the UK. This suggests a real opportunity for new advisers to enter the profession.
It takes a long time to build a relationship and trust an adviser. If that adviser leaves the profession, you have to start again, so what do you look for? Another adviser that has time in the game, probably in their late 50s with years of experience. . . who is also looking to exit the profession within the next five years. And so, the merry-go-round goes on.
A client / adviser relationship is intended for many years. To guide a client through their accumulation years, planning for the future, steering the ship through troubled waters all the way into retirement, old age and decumulation.
The real benefit of having an adviser is to help clients negotiate changes throughout their life, and ideally is not just a short-term relationship. You also want to know that when it’s time to pass your wealth to your family, your adviser will be there to help your loved ones during one of the most difficult times in their lives.
Chadney Bulgin are no different to other IFAs in that we too have the challenges of an ageing population of advisers within our business. Already over the past five years we have waived farewell to six retiring advisers and have another six due to retire in the next four years.
To address this situation, we have been actively recruiting the next generation of advisers to manage our clients’ relationships through their many years ahead with as little disruption as possible. With a long term view we have been actively recruiting those advisers freshly qualified looking for longevity in careers with Chadney Bulgin.
Already we have seen the average age of our advisers at Chadney Bulgin reduce to 51 and with the next phase in tackling the next generation of advisers and clients in motion, we hope to further reduce this average over the coming four years.
In 2019 Chadney Bulgin launched its adviser academy, with a remit to bring new talents through to support both the future of our business and the relationships we have long established with our clients and their families.
In training our own, we are imbedding within our new advisers the culture and behaviours of Chadney Bulgin and passing on the knowledge and experience of those with many years already behind them. Sitting alongside and behind our next generation of advisers is a strong, well established, experienced and robust company that cements the values and high standards our clients have long come to expect from their adviser.
Our experiences to date have shown us that new is not to be feared, new is exciting. Willing to embrace change, new technologies, and understand the challenges in economic, social and environmental attitudes within this ever-changing landscape is an important attribute for our advisers to have.
At Chadney Bulgin we celebrate the next generation of advisers and we are encouraged to see other firms realising the need to train and bring through new talents within our profession in order to secure our futures and our client relationships.
This article was written by Luan Mahoney, who is Head of Operations and a Partner at Chadney Bulgin