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TRAP LIVE IS HAPPENING ON 9th MAY 2024. BUY TICKETS HERE: www.therealadviserpodcast.com
In this latest pile of TRAP, the Trap Pack discuss
Links referred to in the show:
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Help us to help you! The more followers we have, the more we can do stuff going forward. So please:
Welcome to The Real advisor podcast, t r a p twerp please follow us and join in the conversation on Twitter at advisor podcast where you can suggest ideas and themes you'd like the track team to discuss. Also remember to like and subscribe to our YouTube channel and leave a six out of five star review on iTunes. Doing all this really really helps us which means we can do more to help you. Now let's head over to the studio for the latest pilot trap
Nick Lincoln:yes indeed, dear Travis, welcome back to what many people are calling episode 43 of the real advisor podcast T ot eight P trap. My name is Lincoln Lincoln. Joining me as ever in the digital studio of doom are the three other Horsemen of the Apocalypse. Call den of Archie widger Hello the storyteller Smith and and the ultra hot Now gentlemen, we have a show packed full of app salutely nothing so let's start packing it straightaway with some more high energy review reads read out by my good friend the Right Honourable Mr. Andrew Hart
Andy Hart:Thank you lick we have three short ones today. The first one is from NJ marshy and titled interesting listening five stars listened to trap for the whole of a 10 hour overnight drive to the Isle of Skye and didn't fall asleep. Wow. Next up windy Miller fantastic five stars are great. Listen as a sole trader I like it's like having friends in a room to share ideas and motivation. final review from Ooh Judah wounds 85 Great work keep it up. I really enjoy listening to and learning from these four and is my favorite great chemistry and humor. Keep it going. Thanks for answering my counseling question on the show. Joel. I added that extra bit back to you. Yeah,
Nick Lincoln:great stuff. Thank you and thank you TRAPPIST for the lovely reviews they do give us a shot in the arm do keep them coming leave a review on your podcast application of choice which is normally iTunes as it's hard to leave reviews on Android if not impossible. Imagine being on a 10 hour car drive and you fall asleep at the wheel. The last thing you hear on this mortal coil is us not destined to go to the hot part of the under under the surface of this one. Okay, let's crack on with some topical tidbits put a timestamp on this episode. Lots of stuff. Lots of stuff happening in our in this thing of ours and this world of ours of personal finance where money and emotions collide often quite violently. Voice you have an internal promotion at Metis noi.
Carl Widger:Yes. So to start off today's episode with some good news. So potty Andrews, who works in our Dublin office, we've appointed him as director of private clients. So basically, Patti is going to head up our Dublin office and look after the growth fashio were looking for in the Dublin office. The reason I mentioned it is kind of twofold. I know there's loads and loads of younger advisors out there who listened into trap and it'd be wrong for me to single out only party but in matters, there are just so many examples of people who've just put their head down, got their qualifications keep doing great work, and opportunities are arising and like Metis is only one tiny little example of how and where those opportunities kind of arise. So look, it's just to everybody who's putting in the hard yards, you know, just keep doing the work, keep doing great work on opportunities to arise. And also, if you're interested in joining buddy's team do give him a shout but look, it's it's a great party is a great example under there are lots of other examples in matters of younger folk who've really done you know, put their head down believed in this thing that we call financial planning, done the work I'm the often says, you know, this isn't quick, there are no quick ways of getting, you know, to kind of a senior level you got to put in the work over years and years. But, you know, we've got loads of examples of how that works. So, yeah. Is
Alan Smith:paddy the ex professional sportsman? Yes.
Carl Widger:No, because Gaelic football in Ireland is an amateur technical got seven all Ireland football medals. Yes, he has
Alan Smith:right and he got that wrong.
Andy Hart:It's a beautiful Norwegian name as well, isn't it?
Carl Widger:We have hands on someone else are going to be our online for promotions in Norway. Those shortly Yeah, that
Alan Smith:is great guy made me feel very welcome. On my famous trip to Limerick last year, enjoyable, infamous, infamous. Yeah.
Andy Hart:But that's another story. It's quite it's quite a common root x. Amateurs stroke professional sports people coming into the role of financial advisors. So do you want to loose expand on that if you can't call around?
Carl Widger:Look for it look for me, we've we've a couple of examples of this. And it's general one thing about professional sports people, they're used to being in a competitive environment where feedback is not seen as criticism. And potty. I remember when Patti joined us first he used to ask me for just give it to me, I need to know how am I going to get better? How am I going to get better? So this rather than trying to, you know, kind of maybe be delicate about a certain topic? He's no given me straight? Yeah. How did I how can I get better? How can I do this better, and just seeking the feedback as opposed to waiting for it to come? So, you know, I think that's, that, number one, the competitive environment. And Number Number two, the ability to take on board feedback, and to use it to try and get better. I think that's something that professional sports people are just used to. So you know, in the commercial professional environment, it does, it does work. It definitely does. Yeah,
Andy Hart:I can think of about 10x professional sports people that rugby, isn't it? Yeah, a lot of
Alan Smith:cricketers don't know any footballers? slomo. Yeah. Nice. X. Oh, that's a good opportunity for me to shoot shoehorn in because I was a bit lacking on my topical tip bits as I've been away recently, but I've been okay. Yeah. But yeah, did you see that? Article? Chris? Smalling X man, new player? Yes. Now suing his financial advisors for 750,000 pounds in the mainstream press the other day? Interesting one, he didn't realize that you have to think from aiming you never know for certain whether the article is quoting, you know, is that accurate, but based on the newspaper report, he was put into a series of looks like investment bonds University, the UK tax structure, like 80 grand a month, putting it into one bond per month, I didn't realize that when you encash them, there's a tax liability on them. So suing his advisors, not explaining that and for the fees they charged if
Carl Widger:they were taking off from fees, or wasn't that he's saying give me the fees back? I didn't know that
Alan Smith:not sure, exactly. They according to the article that we're waiving the initial charges or reducing it or something? Yeah, not sure the details, but it's an interesting one, because this is not this, this is one of those levels doesn't go through the ombudsman service, this goes straight to the High Court, this would be a high court case, the advisor is going to robustly defend their position. So it will be interesting.
Andy Hart:Do you know if the underlying investments are sound? Or is that a sort of
Alan Smith:secondary point? Not? Not really, I mean, no doubt he will have had this it must have been fully disclosed in all the documentation. That's not an example of a 300 report a 600 page report and it's on page 523. You never read it, but they you know, they've complied with the with the rules. Interesting. There we go. We'll see how that one plays out. Over to you, Mr. Chairman.
Nick Lincoln:There's quite a bit of negative press around fees and advisors in at the moment isn't and I'll come on to that a bit later on for what am I typical Tibbets? So we're constantly hearing about this wave of money that's cascading down through the generations, we did a well received episode of trap maybe three or four episodes ago about the wealth, generational wealth cascade. I saw interesting things on Morningstar and TRAPPIST, if you haven't signed up to monitor that, actually, they're pretty decent, actually, some of the stuff they put out is good. We've got loads of different emails you can sign up for, but there's one aimed at advisors, it's aimed at us advisors. But what happens in the US, you know, basically comes over here, so it's always good to get it. And I got this email from Morningstar saying that 4 million US citizens are going to be turning 65 Every year, for the next 16 years, 4 million a year are hitting 65. Now, the US has got a population of about 370 million, and we've got a world no one no one knows how many people are in our country. But let's be polite and say 65 66 million. So you can extrapolate those figures and say maybe just under a million in the UK, we'll be turning 65 each year similar sort of demographics, similar, similar economies. So lots of money will be flowing from from those that are leaving this mortal coil to those they leave behind and study from nights Frank details that over 90 trillion in assets will move between generations over the next 20 years. So what are we think about it and whether we think it's viable to have intergenerational wealth managed by us looking after children and grandchildren or not, the money is definitely flowing down and going somewhere.
Alan Smith:I don't really. I don't really take it quite as that as intergenerational because the data is around people turning age 65. Right. Yeah. So based on all the various analysis, those are that's what we often talk about a multi decade, retirement. So those people particularly affluent ones are likely, or at least one out of the two and a couple could well live another 30 years. So yes, there will be some of this wealth being passed on. But a lot of it will be utilized to provide a secure and dignified retirement for these absolutely for multi decades, for, you know, 1020 30 years and beyond, and then it begins to cascade down. Beyond that the numbers that I refer to them in the last episode, I think, because it came out of the thematic review the FCA thematic review a couple of weeks ago, they quote the numbers. And they caught them differently, but they say it's for the next 10 or 15 years, 25% of the population of the UK will be aged over 65. And a fair amount of them will need advice and help with navigation around all the you know, income strategies, tax optimization, et cetera. And just looking at a pure supply and demand equation, there's not enough advisors in the UK right now to provide that. So I think the future is looking pretty bright. Yeah, great proper for real financial planners, just looking at the demographics. I just
Nick Lincoln:reiterate what their what night Frank said that over 90 trillion in assets will move between generations over the next 20 years. That's their words, not mine. So yeah,
Andy Hart:the article is referring to the next four years been the peak of the amount of people turning 65. So it's roughly just under 4 million a year for the next four years, which is loosely what Nick alluded to. And also further on down in the article, it mentions about the split of wealth. So the baby boomers are now in control of $78 trillion of assets, which is 50% of the overall wealth in the US. So again, it just shows a quite a simple chart. Again, it's like broad brush, sort of sort of assumptions. And also Morningstar have a conference in the UK on the first of May. And it's looking quite decent. I think I'm, I'm going Nick, are you going?
Nick Lincoln:I think we're going we're gonna see it looks alright. Isn't it just look around? So yeah,
Andy Hart:do check that out type Morningstar UK conference. I think we've got five conferences around the world this year. One of them's in the UK. So yeah, do check it out. Back to you will certainly began
Nick Lincoln:to lunchtime, and then we'll then we'll review the agenda after after their awesome panel sessions after lunch and yeah, so
Carl Widger:predictable.
Nick Lincoln:Okay, Mr. Hall, you've had your surge meeting over you've met both of your clients. How do they go?
Andy Hart:Oh, yes. So yeah, I thought I'd talk about something real lucid spoken about it. In the past. This is my second full year of doing it. I've been sort of working towards it. Yeah, it's pretty relentless. So February, March, I had just over 30, client meetings about 80% are on Zoom, I gave the clients the option. It's pretty full on. A lot of it is around tax planning. So CGT, staff, ISIS stuff, pension stuff. So that's why I do it that time of the year. It is good. So all those Oh, there's a lot of sort of recurring themes between all the meetings, sort of from a financial planning point of view, it just means you're a bit sort of halter at dealing with the things you've got to deal with. There's a load of after work with it. You know, thank God, I've got a great platform, great team, yada, yada, yada. So yeah, we'll continue to do it. Again, if you've got 70 or 80 clients, I think it would just be unworkable. Some advisors have contacted me say they've started their surgeon meetings in November. So they're doing it November, December, January, February, March. So that way they can somewhat do it. That doesn't quite appeal to me. Yeah, I know. Some people are thinking about implementing that. I know nobody on the call. Does it again, running businesses. And Nick, you you spread it throughout the year. But yeah, I'll definitely be continuing to do it. But it's pretty relentless.
Alan Smith:Yeah, it doesn't seem doesn't seem that overwhelming 30 meetings in two months, 15 meetings a month?
Andy Hart:Yes, a lot of 334
Alan Smith:a week. He's
Nick Lincoln:got his voice training and everything else that he does in the background. So which which we don't always other
Alan Smith:brands to run.
Andy Hart:It's the recurring theme this year definitely. For me, I know it comes up a bit it is just the struggles of dealing with elderly parents. More the emotional lifestyle stuff rather than the finances and sometimes it's sort of a health declining of a close spouse of some my clients in their 70s and 80s. But it's really, really impactful for a lot of families that have as I say, parents that are aging and then obviously going through the you know, dementia and things like that. But um, I mean, all we can do is obviously discuss this with clients and talk about the options and you know, leading up to it create as much wealth as we can so then they have means if they need to have sort of care in the home and care homes and stuff like that, but the emotional drain sort of struggles with some families is really a recurring theme. Allen Yeah,
Alan Smith:just again, shoehorning in again, this is what I'm going to do in the future not not come up with any any ideas or content but just To comment on your stuff, but just kind of joining a couple of dots here, I saw Nick, when I was catching up with my emails on your now legendary IFA email group
Nick Lincoln:will have a forum. I think it's tiny.cc/ifa forum. Yeah.
Alan Smith:But it's a dip into that. And it's pretty good. But I saw something come up recently, and people are asking a question around. I know, this is a kind of UK thing. But the compliance requirements, because I think when you're having those conversations, and the and someone says, my aging parents or whatever, it might be all my kids or something, and you often get, I need to withdraw 30 grand for blah, some issue and I'm just trying to get a view on it, because it seems to be quite mixed responses to the person asking the question in terms of what the compliance requirements are. Somebody made? Yeah,
Nick Lincoln:no one knows this. You can ask you can ask 10 advisors, 10 compliance people, you know, when people are taking money out of their pots, D cumulating. To use the awful version, you're spending their money. Yeah, you know, you might have an ISO and that's fine. But the taking of a pension, then you need this, this and this. And if you take it, it's like yeah,
Alan Smith:adding Look, just topping up existing ISIS and existing accounts and tell you I mean, we pretty much do a belt and braces and is quite time consuming every money in money out doing a suitability check, blah, blah, blah, writing it up, etc. And I know that others don't some apparently do nothing. If the client has done it without advice. And some do some do with one line email. Thank you very much top up to save funds. So this is what if any listener knows the answer, answers on a postcard, please send them in. Because we're all a big
Andy Hart:it's something we all struggle with. Trump has an
Nick Lincoln:annual planning meeting with clients last year, September, October last year, and they are doing some housework, they're having the kitchen renovated. And then like my, my essay that sent out card that you talked about the cards have to have the cash here now to pay this this renovation. So we sold to cash last September. So this is going to we note in their eyes. So that way we know the money is going to be there when you need it now now being April, and this morning, the guy that the husband called me so yeah, we need we need 30k of that money that you saw down there out of our eyes. And I just zipped it off, because we discussed it last year. And it's documented in an audio and video recording of the meeting and the cash flow and everything else. Absolutely. It's been it's already in case it's not selling out of fun, because that was done last year. So I just picked it up, just picked it over to them. And that's it, I just but someone else will say no, no, no, you need a suitability letter and you got to get a KFD you know, and all the other crap.
Andy Hart:You do their attitude to loss.
Nick Lincoln:It is a gray area. Okay. Right. So the next topic that we are going to delve into is voice active fund managers. What would they say?
Carl Widger:Yes, so I picked up this article, I think from city wire, or there was a very short video kind of three and a half, four minutes long, where ETF fund managers are asked in a roundtable would you put? Do you put your own money into your own fund? And it was really good because they it went from very short. Yes, I do. Everything goes in there to Yes, most of it isn't in there. But I do hold some cash. And then one guy went and said, Yeah, you have a little bit of active or whatever. But overall, it seemed to me like very valid and honest answers. And I thought after I watched the video and who are active fund managers, if they were telling the truth, have the same, the very same types of answers, which is, you know, yes, I run an active fund. Yes, I pose all of my family's wealth into that particular fund. I'm not so sure the answers would be as emphatically Yes. As they were in this short video that I watched. But then again, maybe I'm wrong. Maybe they absolutely would. I know from talking to some people in this group, that some active fund managers or clients of theirs, they certainly do not put their own money into the funds that they run. So I just thought it was a it was an interesting, very short kind of piece. And sure, who knows what the answer to this one is,
Alan Smith:I can add a little bit less color to that. And be very careful what I say. But I can't say this was years ago years, guys, you know, you guys know our office is in the heart of the City of London where a lot of the investment managers are based and some are looking for financial advice. It's not an area we specialize in with fund managers as clients. But we certainly had one I can say this now he's no longer a client moved far away. He moved to a different country many years ago, but came to me I met with him. And he was the manager of a large active portfolio, an active fund. And he was one said to me straightaway, I just want index funds. That's it and I sort of looked at Have a bit quizzically because I was prepared to sort of run because he, you know, assuming that he would want to have a lot of his money in his own fund or his own companies.
Nick Lincoln:So Neil Woodford knew what he was saw he knew he was going down the pan.
Alan Smith:Yeah, wasn't him. But he just came to my mind. Yeah, no, he's, and the guy said, and I quote, you can't beat the market. You can't be the market consistently long term. We've done okay. You said we've done okay. Over the years, we can't be to consistently long term investing for the long term. And I never forgot that story. So yeah, interesting. And yeah, you're right, Carl, if you were to sort of line up people, if they had to disclose how much their private family wealth was held in their own funds. Surely,
Andy Hart:response Surely these? Surely these people have a sort of canned answer for that question. surely knows. It's going to come at some point. Yeah. So what do you do with your money? But also, the video is quite interesting. Yes. The Vanguard ETF guy that's head of Vanguard ETFs. doesn't invest in ETFs. He invest in in life strategy funds. Yeah. A little bit old. And he's in 80%. equities. Because, of course, he's got to have a, you know, correct asset allocation, the LNG persons into multi assets. So, you know, each has their own but yeah,
Alan Smith:actually was, and again, this is this is fully this publicly disclosed, I remember years ago, maybe 1012 years ago, octopus, as a fund manager, they had this an absolute return fund, and actually, it was probably around 2008. So longer than that, time flies. So he had this comment with a guy's name, but very publicly, and I went to a couple of meetings or presentations around the time, and he was saying, all of my money and a lot of and he said, my wife's money. I remember him saying that was kind of, you know, it was quite comical for him on the stage promoting this fund. And it had done really well he just got a couple of bets, right? When the markets were crashing, as inevitably happens, someone gets lucky and he'd shorted the market or something or other. And he performed really well. And he said, I'd say 100% of my wealth, and my wife's family's wealth is in this fund. And that was that was reassuring for the people in the audience, because at least you know, at least he was high conviction. The funding following year fell about 60%. Correct? Yeah.
Carl Widger:Standard. Standard Life putting their entire company pension fund into guards. Yeah. Oh, no. Because we believe in the fund. Yeah. Pictures. Okay. Let's
Nick Lincoln:crack on. Let's crack on. Bring some water this. I don't know how you say it. Mr. Hart? SPIVA or spavor?
Alan Smith:I think spavor It's beaver. Okay. Go on. Yeah,
Andy Hart:so a couple of points on this. There's a link in the show notes. Alan's sort of mentioned this before and done a couple of sort of tweets about it. It's a company s&p global, it's one of their sort of divisions. speedfit does a lot of research on active managers beating the benchmark beating, beating the market. And again, it's obviously encouraging reading for us asset class, investors, index investors, etc. And not so good for active managers. But I think I'm just going to mention this to sort of younger listeners of trap, I've made this mistake in the past, when you get involved in financial planning for financial planning, you sometimes take your eye off the ball a little bit with the investments, whereas at the end of the day, you're still looking after people's life savings. And if you underplay it too much, it could be a problem for you, you know, I've done it in the past, I say, I don't worry about the investment. That's easy. We'll sort out the end, you know, what you want to do with your life and stuff? The client looks you think, well, actually, I've got a lot of money here. And you're just sort of pushing that to the side. Now you're asking me about, you know, what's important to me in 30 years time, we know that that's the good stuff and the good questions. But again, I just do encourage younger advisors to bring the investments front and center not to spend ages on it, but just to certainly be aware that the investment is very important, we will get the asset allocation, right. We know it's your life savings, we've got to get it right. So I'm just saying when you get too don't get too evangelical about you know, full fat financial planning, we know you know, the coaching and all that sort of stuff is the good stuff that they're gonna get but do focus a little bit on the investing so an example of this is this beaver sort of content that they produce the Morningstar staff, the JP Morgan staff, the dimensional stuff, the Vanguard stuff, you know, do refresh your, you know, top up your financial vitamin C every quarter or something just to get a bit of a grasp, and your head around investment. So that's a bit of a sort of preach to younger advisors to not make the mistakes I have done here in huge,
Carl Widger:hugely valid point and definitely a mistake we made at Metis Ireland. We went way over towards just let's focus on the financial planning because the investment stuff is easy peasy, straightforward, passive index, all that kind of stuff. And, you know, we were challenged A buyer client advisory panel and some other clients go look, I get it. Right. But I need you to spend a little bit more time on talking to me about how my investment is doing, how is it doing compared to XY and Z? So we've had a shift over the last couple years, I had a long conversation with Alan about this. It's probably four or five years ago out, and I would say, and, you know, it was something I was kind of resisting, because I was that evangelical Oh, it's all about the financial planning. But you know what, this is a little bit like, you know, being commercial and given the clients, what they want, you know, meet them where they're at. And if they do ask and require that stuff, as you say, it is not hard to research and get some, you know, data, you know, newsletter stuff that you can put out. So we do do kind of twice a year investment newsletter, we are spending a little bit more time in the annual planning meetings around investments. It's not to say that it's it has come full circle, and it's not the priority, or the or the main theme, but definitely a little bit more on it. Yeah, it's a great point.
Andy Hart:Because just to push that a little bit further, again, people say, what is it you do? I'm a lifestyle, financial planner, obviously, nobody wants one of them. What is it you do on my financial planner? Again, nobody even understands what that means. What are your financial advisor? Okay, sort of understand that I might and might have a need for that. If you even say you're an investment advisor, and it's what we do we do look after we do look after money, it's not it's not a it's not a bad thing to try out. So if someone says, What is it you do saying I'm an investment advisor? I mean, they're gonna get behavioral coaching, proper financial planning, with cash flow stuff. But if it gets more interest in the prospects you're speaking to, it's not a bad thing. Again, you
Alan Smith:say your behavioral investment counselor?
Nick Lincoln:What everyone wants the behavior
Andy Hart:investment? Counselor, sir,
Alan Smith:Mr. Murray's,
Carl Widger:very good at what I do, but I have no clients. Yeah.
Alan Smith:We mentioned this before, when we did a bit of client feedback client survey a little while, like maybe a year or two ago, would you would you like about what we're doing? What do you not like, what we'd like to change all that sort of stuff. That was the absolute loud and clear message. And it came was a little bit surprised, I must say to some of my colleagues who were just passing over the investment stuff in three minutes in a client meeting, and they said, I wouldn't mind a bit longer focus on that. And we, we changed it up quite a bit. There's another thing that I'll chuck in here, as well. And as a business that's been going for 20 years and started in the kind of fun picking or outsourcing to discretionary managers and so on, then, you know, having the, the sort of road to Damascus moment, when you sort of begin to learn the stuff and do a sort of deep dive, you understand it, and you think, actually, it's embarrassing that we didn't know this stuff. You know, however, many years ago, it was that we began to do the research. And then you got to have a compelling pitch to tell your clients that having done all this other stuff, kind of, in theory, wrongly, but not wrongly, that there was a better way of doing things. And we had to really learn because I think a lot of people are going through a lot of listeners, and some of the messages that I get, and you guys get I kind of going through this, and there are firms right now, yes, but we currently outsourced to X Y, Zed, active managers, or we run our own in house active portfolios, and we I get the reasons to change and move towards this. But what do we tell our clients? Are we doing it wrong? And the answer is you don't really you say we're doing exactly the same thing in terms of you know, the asset mix is the most important thing would just be more efficient with capturing the market returns. And here's the data to back it up. And referring back to SPIVA, Morningstar, and all the other resources, the tweet that I put out, which I had before, the numbers are just ridiculous, you know, the longer the periods that you examine, you know, you're in the 90 plus percent, when he was 15 years, 90 plus percent of active managers underperformed their benchmark over this period of time, and then the Netherlands was the best of all 100%. In the Netherlands, the speaker report, that's quite an effort to do 100 Even just in five years, 510 1520 years, 100%. So interesting.
Carl Widger:piece of feedback we got was, you know, using very long periods of time to demonstrate why indexing blah, blah, blah, right? Can kind of pits people off a small bit, because they go look, I get it, but I'm going to be multi decade and all that. But I'd like to know, like five years is a reasonable timeframe. So there is a little bit of cajoling and coaching and all of that kind of stuff with clients to go along. You know, so just be careful focusing too much on Well, since 1954. This is you know, like, I don't give a shit about article 54. It's like, what does happen, but another
Andy Hart:language? Yeah, you're
Carl Widger:right call. Sorry. Sorry. Sorry. Sorry. Another other point there is. So I used to say when people ask me, what did you do, what do you do? I'm a real lifestyle financial planner and it was Like if you said that in a social setting did like, great. And did you watch the match in the weekend? So now with JJ Oh, we do financial planning, and we're Wealth Management advisors as well. It's like a no, I'm getting older. And what do you think about this stock? Or Bitcoin? Or somebody said to me recently, oh, my mother in law has a fund portfolio that we're trying to move from Switzerland over and it's like, Jesus, so look, you you have to be prepared when you tell people what they want, you know, oh, yeah, we manage money. You're gonna get all those questions that you'll probably be addressing? Did
Alan Smith:I tell you that? Do I tell you the story? My story about what good I did? Was that like breakfast business group, that DNI DNI?
Unknown:Grab yourself a drink a very long drink. It's story time with Alan Smith.
Alan Smith:Yeah, I wasn't expecting this one. But I'll throw it in so many years ago in our early days, and someone said you should go along to this BNI group. And anyway, for anyone who doesn't know I presumably got them in Ireland as well. I think it's a global phenomenon. global startup in California. Yeah. And so, you know, so you get a lawyer, a plumber, a life coach, a beauty therapist, you name it every kind of different profession under the sun who meet at some ungodly hour at 7am, or something at a sort of central location or all of it and the idea of guests is to refer people you know, I need a plumber, I need an IT specialist I or someone I know needs one. And so I arrived is the one and only time I ever went to such a meeting. And we're going round, and I thought I know I'm going to experiment. It was kind of early days, I just come off the pull arms and course on kind of the whole cash flow and financial life coaching all the rest of it. And it went around the room. And it came to me I thought, bollocks. I'm just gonna stand up here to stand up give one minute and I said something along the lines of I'm a financial life planner, and I help people's I help make people's dreams come true. I've even laughing at it myself. I said something like that. I thought I've just got to experiment because I have nothing to lose. Anyway, so then sort of sat down and they never look Israel. I'm a plumber on a fixed burst pipes and so on so on would run the room. And then after that everyone has to see like what they're looking for this week. You know, as I'm looking for a plumber looking for
Nick Lincoln:electrician or something and you're taking me back to a BNI meeting,
Alan Smith:somebody said, I need an IFA, and no one ever know I will try and get one in the next hour. There's no ifs here, and I went well, hello. Then everyone went. I thought you said you were like a financial life coach or something? No, that wasn't really what I meant. But I do. You know, what you realize is just go. Yeah, we were the IFA, we
Andy Hart:really do confuse it within the profession and arguing about what to say. People want to put people in boxes quick. Exactly. Right. Yeah. Like I mentioned, like, electrical. refrigerating, you fix. Fridge fix so yeah. Lay carpet or carpet fitter? Yeah, I'm a mortgage broker. You know,
Alan Smith:we start some you think it's somehow demeaning to be an A financial advisor financial. financial advice is the entry level financial advisor. Yeah, from
Nick Lincoln:sleep coach when they mean watch. Yeah, things.
Carl Widger:Digital sleep friend when they mean cars, friends.
Nick Lincoln:It's more of a friend than a car. Sorry, Andy. All right, all right. Back on Track, because we're. So in the last couple of weeks, we saw the passing of the late Danny Kahneman or Kahneman The Godfather, I guess of behavioral economics, I think he was 90. So he had a damn good innings. And he and his colleague, Amos Tversky. Did this work, showing that human beings aren't rational for decades, almost centuries, really, economists have treated human beings as being rational. And if you give them a series of choices, they'll make rational decisions all the time, and Kahneman and Tversky with their work, so it actually is not the case. People are massively irrational. The work he did in behavioral economics has fed through into various facets of our life, both in finance in what we do, but also in public policy with nudge theory and that kind of stuff. All stems from the work those two gentlemen did, he passed away. There's a very good article by Jason spike in the Wall Street Journal, it is behind a paywall, and if you don't subscribe the Wall Street Journal, I would really recommend a Trappist. It's about three or $4 a month they got some really good writers in there. So the link to that article in the show notes I'll quote from it very quickly. For all his knowledge of how Foolish investors can be Danny did Danny didn't try to outsmart the market. I don't try to be clever at all. Danny told Jason is five most of daddy's money was an index funds. The idea I that I could see what no one else can see is an illusion. All of us will be better investors. He often said if we just made fewer decisions. So rest in peace, Danny Kahneman I did try and read his book Thinking Fast and Slow in April 2012 gave up on
Alan Smith:it because it was, it was just as hard to me there's
Nick Lincoln:Thomas Piketty as capital on their coffee table book just there. Yeah, that's impressive. miserable. Yeah, exactly. Exactly. It's
Alan Smith:interesting, interesting thing is that it is humans are being completely irrational. By by, by taking the by doing the behavior that they do. So it is perfectly natural to sell out of your equities during periods of market disruption and falling. That's just a natural thing to do. But it feels unnatural, because the markets go up in the long term. But we do you know, it's a fight or flight mentality. But yeah, the absolute godfather of this stuff and rip
Andy Hart:on a lot of things. Early work, in hindsight was quite elementary. It shows how far we've come. You know, you know, newsflash, humans are a bit stupid. Oh, really. But, you know, how dare you say that. And then here's, like, you know, reams and reams of research to prove it was now. Yeah, it's become a bit more standard. But yeah, and then
Nick Lincoln:I was gonna say the better book I haven't got the Shen essay, which is my fault. Sorry, trapeze. But there's a better book on the story of Amos Tversky and Daniel Kahneman working together and how they how they met each other in in Israel and Michael Lewis, and how they eventually fell out. They were speaking with a time to frisky died in 1996. But interesting guys, they both fought in the Israeli army. They both fought in the Six Day War they both you know, they both had been on the battlefields this
Alan Smith:the as Michael Lewis Lewis, I can't remember the google
Nick Lincoln:it Trappist monk, Michael Lewis, the author, and that narrows it down to something.
Alan Smith:Know the framing something or the anyway, yeah, fine.
Nick Lincoln:Yeah, Google is way better than Thinking Fast and Slow. I think I just think slow all the time. Like the book was too bloody fast for me. Okay. Watch. Something's going pear shaped in the world of solar? Yeah,
Carl Widger:remember, I mentioned this, this was kind of last summer stroke, maybe kind of August, September, the solar investment that was widely sold by financial advisors in Ireland amongst others. At the time, there was kind of a lot of news about, oh, well, we're gonna sell the site, and everyone will get their money back. And I'm always very skeptical about that kind of stuff. And people had to vote for that. Do you give them the time? Or do you liquidate or whatever? Anyway, it seems that they're struggling to sell the sites that these solar farms are supposed to go on. But also the sister company, which was a regulator firm in Ireland, that made a lot of money out of selling this, this kind of unregulated investment? No, no, say a lot of money, an awful lot of money, they cannot repay 75,000 back into the company at the moment. And I suppose look, there's two lessons here. Number one is just be careful with all of this kind of stuff, because it just has a habit of going pear shaped. And even when the story seemed like, oh, there might be a reasonable return, people might get their money back, it tends not to happen. And then, from a regulation point of view, what's going on at a company that made absolutely shed loads of money, selling unregulated investments, and owes 75,000 euros back to the solar conference, in the scheme of things is not a lot of money. Correct. So that's, that is my point. So what's happening with the regulation there? I'm just wondering, so look, it's in the article, you can read the article. But again, another sorry tale of unregulated investments been sold to end consumers. People don't know the risks that are involved and things going pear shaped.
Alan Smith:Carl, what's your view as to why so many people do this? Is this back to just human behavior? Why does so many people sign up? So it just sounds a bit iffy to me to solar panels and solar?
Carl Widger:To be fair, to be fair, I don't think there was anything iffy about the proposal. I just think they couldn't actually put the whole thing together. And they were promising coupons back along the way. And then they didn't have the I don't know if the company is up and running with the coupons coming, the electricity run and blah, blah, blah. So they couldn't pay the coupons. So that's when it started to go pear shaped. I don't think the money was there was I don't think anybody has ever said there's any question that the money wasn't being put towards these solar projects is that that didn't happen in time and the promise coupons weren't coming back. So I don't think there was any. So
Alan Smith:offering something, some headline rate, you get 9% or 10, or whatever it was, but and assuming that they had nailed all these things, you probably might have got that sort of return. Yeah, the
Carl Widger:one. So I have a bit a bit my big bugbears and I'm going over old ground here and I understand I'm right but it's that the financial advisors who sold it were being paid big Don't to pay it right. There was like really big initial Commission's on this that weren't those weren't being disclosed because it was an unregulated investment.
Nick Lincoln:There's your second answer. Yeah. And, look, again,
Carl Widger:I won't go back over old ground, but they're my problems, but it's like now that the regulator is like maybe looking at this firm in the car, pay 75,000 bike, like, Come on, guys, give us a little break here. You know, people need to be held accountable for their actions. And that will give hopefully, consumers you know, a little bit more confidence in what we're doing. Because there's another there's another article that I shared maybe in the next episode that we do, but you know, people in Ireland who have lost money through fraudulent businesses setting up as you know, you've mentioned when Alan before about, you know, things that firms that look like they're doing the same things as us, but actually, it's totally fraudulent. And, you know, that we need to we need to professionalize everything that we're doing give people comfort that, yeah, I can trust these people. But when there's stuff going on like that, it's gonna be it's gonna be hard for us to do their to gain the trust of the of the consumers. And it shouldn't be like that, you know, my holding is professionalize what we're doing professionalism, please.
Nick Lincoln:Okay, yeah, good point and another another gathering. So I think the Gathering Storm, there's not going to help engender trust between potential clients and financial advisors. Is this thing about advisory firms charging for ongoing service, depending on how you define that and not actually following through on it. And I know a lot of people are very gleeful about STP being hauled over the coals for this. Sure they are. And if they haven't done it, they do deserve to return those fees. But it's going to come down the line to a lot of RFA firms, who are supposed to be carrying out some form of ongoing financial planning service, including planning meetings with clients and aren't delivering on that. And Ali Hussain, a journalist for The Sunday Times, I don't think he's a friend of financial advisors. He put out a piece on on on Sunday, obviously an island drew drew our eyes to basically, there's a tweet from Ali Hussain, which I'll put the so called shownotes. If you pay the financial advisor for an annual review, but choose not to have one ask for your money back. A customer of Evelyn partners did this and receive 6000 pounds without quibble. Now there's a lot you can take to task and that itself, I don't think clients are paying us for an annual review. There's a lot more that goes into our value proposition than an annual review. And by the way, at least not an annual review. Because we're not looking back, we can't change what's happened. We're just trying to navigate what's coming forward. So we have planning meetings, not review meetings. But that's just a detail. I don't expect you as a journalist to pick up on that particularly. I think there's a big area, I'm just tightening up my terms of engagement letter about what I'm offering my clients, I offer my client, I offer them an invite to an annual planning meeting. It's an invitation at the annual planning meeting. I'd like that I'd like you, Mr. Mr. Fleck, to come with the annual planning meeting. Because if you don't attend it, it's very hard for me to know, and for you to know whether you're on the right track, and you're paying for the right to have an annual planning meeting as part of what your fee goes towards, but not everything. So I'm just just tightening up my terms of engaged because I think this will be the next big thing and there'll be there'll be some some some people, some lots of clients of IFA firms, not just STP, but IFA firms, who rightly will want to get money back. But they'll also be some chances as well. That's just human nature, I think as well. So I don't think any of us can sit, sit on this and pretend it's not going to happen. And it will be news, and it'll continue to be news. Once this gap is done and dusted. There'll be coming after the independent sector, and quite rightly so if there are firms who do this. I don't know. I think, Andy, you've got a view on this. Do you think that there are way more, there's way more unserved unloved clients with IFA firms than the numbers would indicate from the cursory research the FCA just started doing on this?
Andy Hart:Yeah, I agree with everything you said, Nick, in relation to this specific lady. She was actually even contacted by the firm and asked to do a review. She self selected and thought, I'm okay. I don't need that review. So again, I don't quite know where the firm stands with. I mean, if we follow where we think this is going, the regulator would have wanted the firm to contact her and say, Okay, well, you're paying us for an ongoing service that you clearly don't want. We are now turning off the fees and charges therefore there is no ongoing service, which you've then gone Oh, hold on. That seems a bit harsh. I, I still want again, it's a bit of a mess, a bit of a gray area. So we'll still sort
Nick Lincoln:of it is a mess and I think Sorry, what are these lots of journalists like like Mr. Saying, what they don't understand is if a co say a client, you're stuck with no plan of action, they they defer for two or three years because life happens and they're busy and maybe they're younger clients and they just don't feel themselves they need it. And so insists that says, Okay, well we're gonna disengage. We know we can't, you know, can't you know your payments as money, even though you know, you're paying us this money. Apparently, we can't take it because you don't want no payment and then they'll come back six months later, can we just top up? No, I can't just top up your estimate because now I've got to do the whole factfinding onboarding. Again, I've just I've If you terminate that relationship with your platform, it's not like it's kind of turn a spigot on, it's going
Andy Hart:to increase the advice gap again, even further, potentially, again, but it's still not right to charge fees for service and then not deliver it. So that can I
Nick Lincoln:totally get that. But I'm very, I'm strong in this engagement thing I say, 70% of what you're paying me for is for the ongoing education and behavioral investment counseling are those times of crisis when you're going to ditch the plan. And I don't know how often that's going to be or when it's going to be, but it is going to happen, and it's gonna save you from the financial wilderness. And that's, that's where most of your fee goes. And if you want to save your fees, go for a financial review. Well, that's fine. But that's not what my value proposition is. And I should
Andy Hart:say to say earlier, saying is not to pro financial advisors is it's laughable, he can't stand us. He thinks we add zero value, I think the most he thinks we do is switch around some investment funds every single year, you know, zero coaching, zero, you know, thinking partners, zero speed dial, no proper planning, no tax strategy, you know,
Alan Smith:the chat the challenge challenges, though, that, to a large extent, my read through of the regulator's approach is similar to his there is an expectation of doing and I can't remember what legislation this came out or maybe eight, nine years ago or something, but there's an expectation of doing an annual suitability, check that everything you've you've got is in place. And in order to do that, you need to find out if that has anything changed. So you need to engagement from
Nick Lincoln:your point of view, this is such a such a nonsense isn't that you've got clients in their 40s. And you're doing the annual suitability check. And this turns out somehow God knows how that the pensions you put them in pensions aren't appropriate for them. What are you gonna do cash them in? They can't touch them. They've just, it's just like, what, what do you want us to do,
Alan Smith:you might you might expect just to document that and say, they may, there's no longer appropriate for you, therefore, no further contributions, blah, blah, or whatever, there's, there's a
Nick Lincoln:point they can't get out of them. Even if they aren't appropriate, it all comes
Andy Hart:down to financial planning. But I think
Alan Smith:what this is going to do, and I know that the the going forward SGP model is I think there's something like six key aspects that they are now expected to do, and it's documented on their CRM system. And if they don't do that, and upload their system, then the company will automatically turn off the fee. So that is that is much more, there's a tick box exercise, and it does cut right across a lot of the stuff we we do. Four of us, and people have listened to this, which is far more behavioral. And it is we're on call, we respond, we keep you right. And but I think there is going to be an expectation of there's a minimal minimum expected requirement on an annual basis. And it will be kind of driven by these five or six points you're expected to do. And you're right. This is the challenge. We've had this all of us must have had this over the years. You can phone, you can email clients, and there might be a few of them that just never respond. So what do you do and that do use, what we have done in the past is we do a sort of in absentia review, we do a review that without knowing without just based on last time. And what happens then this has happened a few times to us, the client just I didn't know they relocated to Singapore for a year, they didn't update their whatever their number two new phone number and so on, it wasn't the most important thing in their life to have an annual review. And so we did all the stuff in absence of meeting with you, you know, everything is still is as far as we know, everything's still in place. And then six months later, they get back in touch with you and you got to do the whole thing all over again. So it does cause a few problems. I think it's right that it's being tightened up. I certainly know anecdotally of some people absolutely just gaming the system. Some firms at
Nick Lincoln:scale, outrageous. Outrageous. Yeah,
Alan Smith:I think what this will happen, it will happen. This reminds me a bit of like, I mean, I'm old enough to remember the like the endowment thing and or the PPI type thing. There were just when people see an opportunity to get free money and a voter comes up you see that article, you get six grand back for just you know, and it says without quibble, then why wouldn't you and I think this is going to show the difference between those of us who've got clients and those who got customers. If you're a bank or a huge at scale business of any sort, then no one gives a shit about you know, if it's free money, I just got to fill in a form I'll get my money back language and language wonderful. But if I know, I know them well. And I've been looking after me my family for years and I might have you know, broken bread with them had a glass of wine with them, then I'm not gonna do Yeah. So this is
Andy Hart:how long you've been in business. You see all sorts of stuff. And well, it's true within five minutes of a 15 year relationship can be flipped flipped on his head. True story. You guys are able to fill in fill in the information. I think the article referred to all the FCA article, I think I think was about 3% of clients. They think not getting reviews. I think it could be close to 10 to 10 times that across the industry. But again,
Alan Smith:30% are not getting any form of ongoing service.
Andy Hart:We just because people can't do proper financial planning anyway, so they're almost sort of fearful of going through a full review. Again, they might be able to tinker around the tweak around investment? Well, a
Alan Smith:lot of this, again, comes back to previous conversations driven by incentives back to behavior incentives drive so much human empathy. So much so much of the this industry and I use the word specifically the industry is about upfront fees, if I can get 3% of the client's portfolio, pension fund cetera. And I'm all after that. So it's all about the engagement, the onboarding, that's where the focus would be less incentive about ongoing stuff, really. And I think that's historically again, this is just anecdotally and some stuff I've seen and heard, particularly the at scale businesses all about onboarding asset gatherings a key thing
Carl Widger:initially, income gathering, sorry, yeah, yeah,
Nick Lincoln:just just farming the whole time farming and farming and farming and then not looking after them once they're on board. And I can't I mean, hunting, Nick, hunting, hunting, farming, whatever. Yeah, hunting is getting new clients for farming is existing. So you mean Hunter? Oh, whatever. Yeah, you I meant I meant hunting. Thank you. But the point is that the vast majority of I'm sure seminar and cover the vast majority of complaints that go too far and everything often clients you feel unloved, who have no, there's no emotional connection with their advisor at all, because they just they take their on boarded years ago, and just haven't had any contact noticing our Saudi we might have put this claim in. Whereas if you have a deep relationship with your clients, I took on board your your point, we never really know anybody do. But in the vast majority of cases, if you've got deep clients, they're going to be they're going to feel they're getting value for money. And they're going to trust whatever you say, because if you say, and they know, like,
Carl Widger:Look, I know, I know, there's, I know, there's flaws in the regulation, and you guys, it's all kind of been tightened up over there. And there's gonna be, you know, parts of it that you're kind of going that's almost impossible to regulate. But it's way better than what we have here. Way, way better. And, you know, it's, I just wish we would follow suit. I really do. There was an article recently, before Christmas, this was
Nick Lincoln:this is this is off, somebody
Alan Smith:loses another 50 friends.
Carl Widger:I can't help. It saw a firm who's got half the Aum we have less staff, but double the turnover. I'm like, Okay, so like, what figure that one out? Do you think they're doing reviews? The Comp actually possibly be doing reviews were replaced
Alan Smith:the most commission car? Yeah, exactly. I see.
Carl Widger:And it's just on and on as the next one knocked down the next. Incentives incentive for
Alan Smith:the human behavior? Yeah, over the years, and Andy's my confidant on this, he loves delving into company accounts and looking at other firms. And you know, in Ireland, it's all it's all published. Some of it in the UK is published, not all but you can make some decent guesses. And there are certainly, like you said, as firms way more profitable than we aren't just looking at and scratch my head. And I think how can they be doing that, and you realize it full fat financial planning, let's face it is complex, and it's time consuming. But it's so so damn valuable to the client. And it's so rewarding for the advisor to be delivering this and really sort of changing the course of people's lives. It's not as profitable if you just gather.
Carl Widger:And it's hard to scale. Elena and I spoke about SEO, it is hard to scale. But if you get it right, it's really, really sticky. So you know, it's a good long term model.
Alan Smith:What I'd imagine that you know, and again, we've talked about this before, and you see the average rate, the number of client or client families per advisor, that's an interesting metric. And we're at about maybe 50, for advisor, and I've seen some things called when he used to, when I used to read like new model advisor and see these, you know, firms with three advisors and 2000 clients, you think, Well, what's that all about? There's just, there is no way they can be delivering much of a service. And I think those are the ones that may find themselves in a bit of bother here with this because if you've got those number of clients, you basically simply that there aren't enough hours in the day to the point and use and you still you've been making hay for years you'd be highly profitable. But if you've got to start refunding a load of fees now because you've done little or nothing for these, you know, hundreds or 1000s of clients, but
Nick Lincoln:they'll feel Phoenix, they're better off in Phoenix. That is true, unfortunately. Sadly, Okay, listen, we have given the topical tip, it's a debt Jesus is 54 minutes in shoot me, I think we should move on to the meat and potatoes of episode 43 of the real advisor podcast and today, we're going to talk around and we've talked about this before, directly and indirectly, artificial intelligence AI, it is the topic du jour i get it. Some of you might already be reaching for the fast forward button but just bear with us because when the trap pack talk about AI, we talk about it from an informed interested point of view, don't you problem,
Andy Hart:we are lucky to be joined by the UK leading AI advisor. Please welcome to the stage, ladies and gents has Alan Smith.
Alan Smith:Yeah, as they say, in the kingdom of the blind, the one eyed man is king. And I'm the one eyed man here. Because I have spent a little bit more time than others have. And I'm just Yeah, and as Nick has often alluded to my sort of shiny new object, Magpie brain was got very excited. But here's the thing, and I'll just, I'll lead the conversation. And we can sort of take it as far as we want to do. This came about and I suggested we, we have a discussion about it this time, because I posted something on social media last week, and it was just about some a new piece of technology that finally finally finally we were moving away from just, you know, chat GPT. And we just, you know, can help you write a blog post or something, which is all well and good, and it's quite helpful. But it's not really game changing, or life changing. But you start to see some of these things now, beginning to make an impact and beginning to perhaps, you know, make a material difference to your profitability or outgoing costs or efficiency. And I can and so as a result of that, and I'll talk more about what exactly that post was about in a moment. But as a result, we'll be posting that on LinkedIn last week, I got about a dozen DMS messages, private messages, people saying, Oh, that looks really interesting. Can you tell me more about it, and I thought, rather than have, you know, loads of one to one, messages, I thought, I just replied to them all I said, we're gonna have a chat about it on the next episode of trap. So here we are. What I thought I'd do is just briefly and I will sort of keep it pretty sort of shortened to the point, I'm going to kind of open the kimono, as they say, and just share some of the stuff that we have been doing here at Capitol in June of this year. So just kind of reveal what we've been up to. And it's nothing particularly dramatic. But there are there are three organizations that we've engaged with so far in a meaningful way, which have begun to have a an impact on the work we do. So the first one I've mentioned them before, is a company called implement AI implement AI run by two guys, Piers Linney. And Alex Shukla, too close personal friends of mine, go Nick, to close personal friends of mine who have recognized the challenge. Thank you give. We've recognized the challenge of SMEs as they call us small businesses, for an hence the name the title of their business implement AI, because everyone is overwhelmed with the volume of information apps, new tools and the challenges to actually begin to implement it in your company. So we've engaged with them, and we're going through their program right now. And I think they're a useful place to start. And I will post a link in the show notes because they do a weekly podcast, piers and Alok, and they got a load of white papers, downloads, tools, and some techniques that as if you want to just get a bit more understanding as a small business, they're not specifically financial services related but they are small business relates to the understand the issues and challenges and budgets of a small businesses. So the first thing we've done with them is to create our own AI policies and procedures, anyone with any more than a handful of staff needs to have your procedures in place to avoid people running away and start sort of uploading client data onto some other sort of AI enabled tools. So you get those in place. And then we're helping build out the, the kind of the broader infrastructure with implement AI. Talk more about it if you want. The second company that we've engaged with is a company called satin satin.ai. And again, post the link to their website, again, to bright young sort of tech founder entrepreneurs, London based, I don't know if you guys have spoken or anything with them, but really, really what they really want to do it. So they are financial services focused, they come from a background in financial services, they get it honestly, for the conversations I had with them, often you have conversations with people, and you think they don't really get what we do these guys do, we have we have quite a number of sessions with them, they really understand it. Their view is that they can double and advisors capacity for work for client work, etc. So to be able to double that if you think you could, in theory take on twice as many clients as you now have and still be able to operate, you know, effectively and efficiently that to me, you know, pricked my ears up. I think that's interesting. I'd like to learn more about that. So we're working through with them send you one, Nick, thank you. They there are currently so they want to build the entire financial planning operating system from beginning to end. But they're focusing first of all on where the big challenges and big opportunities are so and for a lot of us is around like, Andy, you've just done your surge meetings 30 meetings in a short period of time. If you could automate the meeting notes, identify the TAs have followed up, have them done things like that. The thing is, the regulator's really focused on a lot right now is vulnerability. For example, if you can automate that and identify through the conversation, aspects of vulnerability for the client and have that documented and next steps, next actions, that would be quite useful. So client reviews, also onboarding, which is one of the hardest tasks we've all got, and training and competence as well, TNC and training for the team, the staff. So they're doing some smart things worth speaking to them. And just as as very specific, we are currently running a pilot with them. So they were using their technology, their tools within our client meetings. We're, we're doing it right now. So we don't, we haven't sort of got the full results yet. So far, so good, was quite positive. And they will offer that to anyone who's listening to this, if you want to engage with Saturn AI, there's nothing in it for me not just recommending them as something that we are an organization that we're using ourselves, jump on their pilot scheme, run, you know, half a dozen meetings with your clients and recognize whether it's any good or not. And the last of this sort of the three things that we're engaging with right now, and this was the one that I refer to when I posted it on social last week, is the model office and the model office, Chris Davis has been around for some years. And we've been using it for some years. And it's really support around regulation, and compliance. And again, whatever we you know, obviously, based on the conversation we've had so far, this week, there's an increased focus on this stuff, getting it right, and using artificial intelligence to interrogate your data, data is obviously becoming more and more important advisory firms. And the specific thing which they are in beta testing right now, is the idea of doing file checks, file audits and file reviews. So they use machine learning to effectively to reflect the FCA conduct of business regulations, which I don't think any financial adviser has ever read in full. And so what they do effectively. So up until now, what we've been doing, because we want to voluntarily subject our client files, particularly anything more slightly more complex about income drawdowns or anything that we've deemed to be more of a high risk area of advice, you know, we pay for compliance consultants to come in to review our files to do an audit to say, yeah, that was good. And they color code them, they mark them as a pass as a sort of Amber, more information required, et cetera. So what's in beta right now is you have the AI do that, effectively. And that was quite interesting. We spend 1000s and 1000s each year on having third party audits of this, I don't think it's going to replace humans yet, I think I still would like a human just to over just oversee the what has been their creative so far. But that's a practical example for a business small business like cars could save 20,000 pounds a year in costs by deploying some of this AI. Technology. I think the last one, I'll throw in just as a, for a bit of a laugh, really. And I think it's the guys that implement AI a lot of there's organizations that can do this. But if you think about some of that, you think about your business and you and all of us are impacted by this. One of the biggest challenges as we all know, we take on a new clients, and they've been with us, you know, either directly or DIY advise themselves, no help. Advice, as Andy would say, and or the beam with another advisor, you've got to find out the find the information about their existing products, policies, investments, etc. That is a painful process. We all know, you go into Legacy product providers, there might be companies, old insurance companies, you know, 2030 year old policies, trying to find the information is painful. And we here at this firm, literally have talented people, highly paid London salary people on the phone to XYZ minutes, we all know the names, waiting to get through waiting to ask questions. Can we ask you this policy? When did it start? What's the pre mostly blardy blar getting all the information that is necessary in order to give proper advice, we can now build a tool which is an automated AI human sounding like voice that knows how to ask the question. So just you plug it in, send it off, and it calls Prudential or Phoenix life or whoever it is and ask the questions. And I've listened to this most of the kind of Robo type people have heard before and press one for this and press two for that a terrible started like a robot. The most recent examples are 99% human like they are really interesting and really good. And I'm sure that most of these product providers will deploy these people as well. The the you know the call center type approach is absolutely on its in its last few months I think of existence. So the funny thing is we're going to have our robots called in the robot. Yeah, you got a robot speaking to each other and getting the data. Eventually this information just be provided to go wrong. But this is I mean, this is current does that help currently available? So we can do that's my starter for today. And then some interesting things as I say, we, as a firm, can see some material cost savings. And we can see some of the very much more mundane tasks being automated. And if you can elevate your, your team, your colleagues to do much more interesting kind of human focused type stuff, it's going to be better for everyone, for the team for advisors, and ultimately, for clients. What are your thoughts, boys?
Nick Lincoln:For us, there is so much that it's still so early, isn't it in this journey with AI, I kind of you've
Andy Hart:raised Nick, it's been going on in the background and come to the fore, a bit more environment.
Nick Lincoln:I mean, in terms of its applications, just just, I don't, I'm not very good at using my imagination to see where this could go. Where, so I just, I know it's gonna go somewhere, it's gonna be transformative. I just don't know where. And quite I still think we're at the early stage of it transforming.
Alan Smith:Let me just run through this with the it's the you have your client meetings, and you have most or all of them via zoom. Yeah. What do you Did you record them? Yeah. What do you use? Do you use AI tools to record the meetings?
Nick Lincoln:No, I just listened. So within Zoom is not just recorded just a recording over the audio.
Alan Smith:So there are obviously there are non financial services specific multiples, often just record fireflies.
Unknown:And now I've got a built
Nick Lincoln:in AI thing. Now, as you can think of your transcript, it will be meeting highlights and bullet points are what was discussed, if you want all that kind of stuff, you know, yeah.
Alan Smith:And well, and so something like Saturn and Saturn, they're not the only one. There is a number of companies around doing this, because most technology companies are recognizing this is where you know, a lot of the work exists in our in our businesses, is annual planning meetings, gathering information updating, if you could get that information. So you just go to recording, you've then got to take that information away, read through your notes, write them up, follow up, if there is advice, suitability reports, etc. If you could have 80% of that done automatically, for example, that must be quite helpful. Or thought, No,
Andy Hart:I'm also struggling to think I don't think AI is going to create anything new, it's just going to take everything that we currently have and make it better and faster. When we have investment platforms, we have cash flow planning tools, we have meeting recording software, you know, so it's just going to sort of add gasoline to the fire as it were. And
Alan Smith:I think, yeah, there's there's two aspects. So yeah, two aspects of AI. One is to make what we do already, just make it better, faster, more efficient, more reliable, and cheaper. That's, and that's great. And if you just did that, you'd be pretty happy. But the other thing is to is to innovate, which is the next level. And I would say to anyone listen to this and what exactly because what we're doing because I would get quite excited about how we can build an entire we can build an entire platform.
Carl Widger:She's skirt skirt, Schoolboy error.
Alan Smith:He's got he's got these AI Amazon delivery, come to the door. Listen to this. Sorry, we've lost Andy Hart. Doorbell readily
Carl Widger:not have happened to a nicer guy. The my my word on this is I think it's early stage in terms of practical implementation, right. So I think there, there's no doubt whatsoever thought there are folks out there designing AI to tie together a financial advisory firm, a financial planning firm, because I think that's one of the challenges for all of our firms is everything is so disjointed the platform is over here. And we're using this fund and our CRM system is here, and we're using zoom and we're so there's no doubt somebody somewhere is because this is a worldwide thing. You know, what we do in Ireland, is pretty much the same as what you guys do in the UK, the states, so it is there. So there's a massive opportunity. And I suppose I'm gonna sound a little bit like a dinosaur here. I know, Ireland has been onto me loads to say, Come on, we need to do this, we need to do this. I kind of don't have the bandwidth, because we're like, you're 10 years more mature in terms of the journey your firm is on. And if you think back to 10 years ago, it almost feels like we're gonna get started on our growth is only kind of beginning to escalate. So I've had to kind of decide, well, where do I focus? What do I focus on? I haven't touch the sides of, you know, what, what bytecode ai do for us. And I've kind of decided, and this is the dinosaur sounding, but you know what, I'm going to leave the early adopters be the early adopters. And when people have fine tuned stuff, then we might, you know, come on board, but also do in beta versions or whatever. We just don't have the capacity to do it at the moment. So definitely something on our agenda, but I don't really have much or anything else to add. I think it's extremely interesting. And I think it can only be good in the long term.
Nick Lincoln:I think one, one of the points that we were thinking about around AI, is it going to bring pressure on advisor fees. And I don't believe it does, I don't think AI changes your value proposition, it doesn't change the role that behavioral counseling can do in the value of ongoing financial planning. It'll mean potentially, that you can onboard new clients more quickly, and you can get through the admin around the annual planning meetings more efficiently. To me that would say you could probably take on more clients and or more advisors, but I don't think we don't want to race to the bottom. And I don't see how having a computer more involved in our businesses makes our value proposition any less valuable to the people that are paying our fees I human beings who still want another human being I
Alan Smith:agree with you, there's I think there's a couple of points on this one, this, the kind of the improvement, fundamentally, is just technology. So the improvement of technology, and doing the things that historically, advisors were considered valuable at doing. So whether that is investment advice, tax planning tax calculations, we're talking about this generation of people retiring, optimizing income strategies via
Andy Hart:computers. So humans overseas overseas,
Alan Smith:but there's a lot of advisors out there, that is that is their service proposition. That's what they offer to the world. And if you can get that done, either yourself or via Hargreaves, or whoever it is just want to use, you speak to your computer, that's the thing, voice becomes the dominant way of communicating, you speak and explain your circumstances, it asks you back, and you say there's a calculation, that's what you do, then, that inevitably, like a lot of things in the past, you know that that puts a downward pressure on overall fees and costs. But what it does do, it elevates the role of the human first advisor, which we are all about. Because that's, that's what we know what I would love all this stuff, I'd love to all this crap that we have to do in the background. But you know, dull but important stuff, love the machines to do all that. And it gives us all more time to spend more high quality time. And that's the one thing that people value many more with clients discussing important things to them and their families. In
Andy Hart:the world that we work with. We're as strong as the weakest link in the in the ecosystem. I mean, you sign a robot calling up dinosaur legacy Life Insurance Company, I think that's papering over the cracks, that lets you know, let's get it is root, they need to change their systems and how they operate to deal with it. They just need to make that like open architecture, they need to try a standardized API system that is, yeah, then C does,
Alan Smith:but I just I just from what I know, these systems are so antiquated. You don't just like plug an AI, I don't think you can be great if you can, because
Andy Hart:20 years ago, you'd bring up some of these companies. I'm Scottish Providence stuff and also some quotes on income protection. They literally send you like a massive brochure in the post of 10 different quotes.
Nick Lincoln:Yeah, yeah. Professional I was a quote was I Dunbar and the broken songs was just throw bits of paper
Andy Hart:and subsidies. Especially you know what, we've done a 20 year term, and we need a 22 year term. I knew it's gonna be the next day. I was like, what it was and all this sort of stuff. Oh, this is what a Scottish providence and so I'm like, Why? Because I called him yesterday and asked for some basic information it used
Alan Smith:to have just before my time used to have a rate card, and somebody would phone you up for it. I literally got
Andy Hart:out quickly. Jesus Christ literally send you like the full key features of the product details anything, just to get some information anyway.
Alan Smith:Yeah, you're right. It's there's a sort of Clash of technology. You got this crazy new space age tech, which is
Andy Hart:90 years younger, or immigrants come in tech entrepreneurs, fixing financial advisors gotta fix it all. I think all right, I would just do that then hit the biggest brick wall of their life now. We got the new tech, it's like none a brick wall.
Alan Smith:Yeah, really
Carl Widger:good example of that, though, for I assume you guys have to get you know, copies of certified passports and proof of address not right. So there's a there's a really cool company here called ID pal. And they've created this app that you can send out to customers and the customer opens the app, and then they kind of show their face and you know, take pictures of their passport and all of that kind of stuff. And we were like, Yeah, that sounds fantastic. Because it is literally the bane of our lives trying to get all this stuff that that the providers have to accept and someone's Thomas besides the passport and oh, we can
Andy Hart:send it back four weeks later. Yeah, exactly. Right.
Carl Widger:Exactly. But we were sending it out to some of our clients and they were like, they were blinking when they were like taking the photo. It was torture right? It was obsolete and we were pissed them the clients off right they were go bananas like saying please don't get But he's not saying that, but can you just come
Andy Hart:out and but this is the tech that companies like revolute, Airbnb, you know, Coinbase or the state of the art companies use for KYC. And you're right, you said that your clients and they're like, what does it? Yeah,
Carl Widger:so this is the challenge. But I'm not saying it's not there. So
Alan Smith:so the programs, you're right, so that the challenge is with these things. And the strategy should be, you know, choose your battles, don't try to change legacy 66 year old mainframe computers to give you data faster, but work out. In all our businesses, there are just kind of bottlenecks, there are challenges, there are pain points, it was time consuming stuff. And the advice really is to choose just choose one of these either onboarding new clients, or at servicing an annual planning meetings and all around that, that's going to be the big areas, there's a ton of other things that can be done. But if you were able to get some quick wins, and even if you could, you know, a member of your team, if it normally takes them an hour to do something, and it takes them half an hour by augmenting the work that you're not replacing or changing. But if they're able to sort of use it as a tool. And as I said before, data is more and more important than other things, you know, we've got Microsoft and the Microsoft kind of ecosystem is gonna be very, you know, as you know, they bought all invested significantly in open AI behind chat, GBT, etc, they seem to really have their AI sort of credentials firmly in place, hence, you know, huge uptick in their share price the last little while. So Microsoft systems can be quite interesting. So if any of your team can save, you know, half an hour or two hours, something like that, you know, yeah. Oh, very, very fair. All good stuff. So think about the areas you think what and that's, you bring your team along, we've, we built a little limit sounds very grand, but it's it works. We've got a little mini AI team, that people that are sort of young and energetic and interested in this stuff. And they're sort of looking in all the opportunities. And what they're trying to say is, Where can I make my life more efficient University, I can do a job that takes me an hour, if I could do it in half an hour, that's a win, we've got a little we've got an AI competition running in the company right now, if anyone comes up with a new AI tool that is employed across the entire business, then as a very valuable cash price for them, why not? So they're incentivized incentives? Again, guys. The last thing I want to say on this, and I think there's quite an important point, anyone listening to this, and if they want to begin to deploy your new technology and AI in the business, there's no shortage of reports out there talking about the number of jobs that are going to be lost to AI in the future. And you know, personal story here, when I got was getting a bit excited about this. Last year, we had a team meeting, and I shared all about some of the tools and tactics that we'd be looking at rolling out and using. I was a bit naive, but I was a bit surprised to see that sort of looks around the room with my colleagues petrified just crop with their arms crossed, no one was really excited
Andy Hart:or engaged junior member of the team that's been alive for the last three weeks. Exactly. Without anyone calling providers. Well, exactly.
Nick Lincoln:All safe.
Alan Smith:I know. You're new. Exactly. Is that what you say? There's bad news. And there's irrelevant news. I know, it's gonna be great. I had to remind people who said, you know, no one's losing a job, we're all going to be doing more engaging, interesting, valuable work. And in time, not today or tomorrow, but relatively soon, we'll have the machines and the robots or whatever you want to call them, do that dull stuff that you're currently spending a fair amount of time on doing. And, you know, in some ways, you need more people. Because as you say, if we can take on more clients, this kind of, again, back to this human first type advice, super important. But so make sure you bring your team with you. And you remind them and encourage them that we need good people around. So let's some of the skills are going to evolve with this. Let's,
Andy Hart:let's start let's start with the end in mind, what would be the perfect outcome of AI being implemented into this mighty profession in the best possible way? Ever? Let's say it's 2030. You're an advisor, you're looking after 75 families now because the techs amazing. Are you genuinely doing almost nothing? Apart from seeing those clients in client meetings? And you could literally work 150 hours a year? Where are we going with this? What's going to be the outcome?
Alan Smith:All right, the outcome increasingly, in my opinion. So this is again, another probably mentioned that here before this statement I've got about everyone's at the moment, everyone's trying to build a better blockbuster. And what we want is Netflix. And so Billy about blockbuster, just having you know, meeting notes, or something like that. So we've already got meeting notes, but we just have them automators that's just slightly better version, what we got. But no one really wanted to go to Blockbuster. What they wanted to do was just turn on the TV, whatever and watch whatever film that they liked. And there's an algorithm sitting behind it that sends you suggestions based on what you've watched. Previously, and that's brand new anytime you aren't, you know, during the day midnight three in the morning, not when blockbuster opens. So the idea or having an always on platform, you want to give me what the clients call you up and ask things. Why do we have an annual planning meeting? Why is it on in April? Well, because, or May or June or December or whatever it is, because that's the date, the month that the client first became a client of ours. So we just annual, you know, we meet them annually in the anniversary. But clients want information at different times. So you want an always on type facility to answer all the basic technical type questions, can I get 20 grand out of my account, can I top up my Eisah blardy blar. And that year, by 2030, I'm pretty sure a version of that, God forbid, you will have something like a little app in your pocket on your phone, which is the device of choice nowadays a mobile device. And you can have liquor in your pocket, Nick Lincoln in your pocket? The
Andy Hart:questions so there'll be like an AI version of the advisor that's got all of the smart information and data that you can ask me like a chatbot. Correct. Nick Lincoln Chatbot. When doesn't it get involved? No. I'm all up for it. And then
Alan Smith:and your time will be spent more workout videos, let's just say you double the amount of face time if you like whether that's real in real life, or video or whatever else with your clients, you know, that unique human experience that remembers things that joins dots remembers that other client that they spoke to last week that's relevant to this conversation. And the client gets more of that, as opposed to less of it when all the functional stuff and transfer of data and information you're gonna love the robots perfect. That's, that's, I think, where we're headed to and it's a better world for all of us and for our clients. I
Nick Lincoln:think we could talk around this forever, because there's so many it's just potentials and what ifs and it's exciting and it's going to be transformed formative and it will be for the better. I think. However, given that spring is moving into summer, we're one hour 21 minutes, one hour 22 minutes into Episode 43 of the real advisor podcast a gentleman with your acquiescence. Shall we move on to the TRAPPIST questions part of the show? I think it's probably the right time to do it because I can see why my nest camera. That post is at the door. There she is ringing the front door she's hold a bulging sack of trapeze questions up in my driveway. If you want to get a question into the trap pack, dear Trappists pinned tweet at the top of our Twitter channel. There's also a link in the so called shownotes. We will get to your questions over time. We're working through them we're currently at November from last year, which is why this first was not really a question. I don't know if you guys have read it. And you might need to be on your on your on your mettle with this one. This comes from a person called Sam called me Bucha. Dear Nick, congratulations to Andy for another enjoyable, insightful humans on the management. So you can see how old this is. I was delighted to win a trap mug in the in the competition, not least because it afforded me the honor of shaking your hand and it isn't honor Sam it is not. And he then announced the competition winners had also received Silver Ticket to have 2024 in South Africa. And he's so generous and thoughtful. But alas, I won't be in South Africa. On that day. I was wondering Vandy would object to selling my ticket and then it's in the money to see a Khaleesi is charity, the Khaleesi Foundation. Thank you for the valuable and sending that podcast. Best wishes, Sam. So how do they go? And then did Mr. Khaleesi say thank you for the donation.
Andy Hart:It was said in jest. So he won the competition in London and I said the great news is you've won a free ticket for next year. And everyone cheered. And I said then South Africa that was the that was the day. But yeah, sure.
Nick Lincoln:Okay, the next the next question is from a female TRAPPIST and I'm gonna butcher her name because Oh, and Alfie meta. This is Jane McAleese.
Andy Hart:Yeah. All right. I think you've met Jeremy a few times, Nick.
Nick Lincoln:I think I have I don't think I don't spend a whole time asking you how I say.
Unknown:Okay, Jane, Jane.
Nick Lincoln:I'm not I love the conversation kicked off by Alan regarding fees and value just coming in from an Irish perspective. And having had the experience of going through the Siebel authorization process twice in the past 13 years. The questions they asked last year, were far more detailed and relevant to financial planning firms than my first time planning. This gave me some cause for optimism. However, unless financial planning becomes regulated, I think we will always find it hard work to make the headway we want. Keep up the great work, guys. And we look forward to having him back in Ireland next year. Is him coming to Ireland
Andy Hart:this year? No, no, he's just in South Africa in September and London. That's news
Nick Lincoln:to me. So I don't know if Jane is asking a question. So the question I'm making a statement. Do you want to use three jabroni his handler
Alan Smith:call shooter respond.
Carl Widger:So ah, cheers fellow. Yeah, I think there's no chance whatsoever financial binding is gonna be a regulated activity when they can't even regulate the investments that should be regulated. But Jane is right, I think. Yeah, it is. It is. It is good to hear or that, at least the questions for new advisors are more about what's going to be your process your systems for financial planning, or using cash flow modeling that kind of stuff. It is good. We've such a long way to go here with when I, the more I see and hear you guys talking about consumer duty, and obviously, I'm reading a lot about it. We can't even get already are and you know, it's like, we're so far behind, unfortunately. And, you know, this is gonna sound like selfish from a man's point of view, because, you know, we think we're doing it all right. It's not, it's the consumers are going to the clients are going to be better served if we did this, and the bad actors. And there's not loads of them, but there are definitely some of them, the bad actors will be weeded out. And people who are on the fence about whether I should do financial planning or not, they will jump on board because they will have to, and that can only be good for the clients, for the consumers. That's what regulation should be about.
Nick Lincoln:Okay, I'll just go I just Jane, I haven't happened and we haven't we have chewed the fat numerous times. Thank you for your question. I am just ideologically opposed to regulation. And I don't think financial planning becoming regulated would be a good thing. Whatever, you'll get them again, the regulator prescriptively, telling us how to do financial planning, which is an art thing. It's based around empathy and emotions and understanding of clients. You cannot have a cops for financial planning. And the idea that you can have a cops for financial advice, but they they make us follow it. And it's 1000s of pages. I think regulating financial planning now, there's, there's, for me instinctively, that is just that would not be a good thing. I think financial planning should be everywhere. I think all financial advisors should do it. There's not the same thing as saying I think it should be regulated. And if you've got firms that don't want to do it, then that's fine. They're dinosaurs and we as evangelists as full fat financial planners, with our with our loudspeakers, with our loud hailers. With our Klaxons, we have to be out there saying this is the way forward, you know, come come to come to Mecca. We we think this is the way forward for you, Mr. And Mrs. Petrified retirees, we can help you out. And that's the interesting
Alan Smith:thing is the lines. As we know, we've spoken about privately, the lines are increasingly blurred on that there's loads of what are they called financial coaches, various descriptions around who are not regulated? And I don't know what they do, do they do financial planning and build cash flow models? Or is it more just coaching around your relationship with money? I guess there's lots of different versus styles. But I mean, that's, yeah, that's obviously not regulators coaching apart, there
Carl Widger:are many, many examples of regulated people becoming unregulated and being successful in actually just doing the unregulated activity.
Nick Lincoln:That's a very, very loaded question. I'm not I'm not aware.
Carl Widger:Are there examples of people who have successfully deregulated and make a have a really good business, doing unregulated financial planning only? Well,
Nick Lincoln:they're certainly prominent, I mean, they certainly prominent on LinkedIn, on social media, and on some trade events, and so forth, without a doubt. I mean, Chris Ballard is an example. You know, Chris, Bob wasn't a wasn't advised owned his own business and regulated business and now runs the Institute of financial wellbeing. And that seems to have got some traction. I don't know whether whether it's a success in whichever definition of success you want to use, but it's certainly a known thing. And he has done that, and there are others, but just there aren't many. I
Andy Hart:think your question was specifically to the client work wasn't a car.
Carl Widger:Exactly. Yeah. Because I because I think the answer is not a
Andy Hart:Friday, and also a few people have come from not a regulated world. But let's say they work to an investment house or something like that, and then moved immediately to financial coaching. So they haven't done that there's a whole mix of different models. The
Alan Smith:thing is people clients want you then to execute on the
Andy Hart:potentially, actually, that's why just to say,
Alan Smith:you don't see an advisor to implement.
Andy Hart:Automation is not really the challenging part in most situations. There
Nick Lincoln:are some there are some younger planners coming through who don't do any regulatory well, they just do the financial planning. And then they'll give pointers.
Andy Hart:He's not right. He's not regulate. There was a you know, I didn't realize no,
Alan Smith:I don't think so. It's who I think's name's Dan Brown.
Nick Lincoln:Yeah. Dan Brown, regulated, but if you don't, if you don't the financial plan, you want to I think you have to be involved in helping the class put together the solutions that drive that financial planning to a successful conclusion, because rarely says anything. Just saying
Alan Smith:to somebody just go and buy I suggest you buy a simple low cost index, portfolio diversified, etc. That's relatively straightforward, isn't
Andy Hart:it? By a relatively cheap global equities fund, I think that's undergoing I think that's under guidance. But some global equities fund that then is advice.
Alan Smith:Some clients already quite competent with the buy a bunch of farms and you know what they're doing, but they could do a bit of structure guidance, planning, etc. The thing is, there's it's a broad church. And you know, there's Nick said, There's wherever 65 70 million people in the UK, there's enough for everyone to go around. Well, the one final point, I'll say, and this is and again, Andy, you and I know this from certain conversations we've had, just like Ireland, the hurdles to get to become a regulated advisor now are getting increasingly tough. And I know of at least one advisor who's an excellent advisor, if you wanted to go to any authorized, wasn't approved. First go, I think is going to go again, the you know, the FCA and rightly so, detailed plans.
Andy Hart:I think the stat now is 8% of people that approached the FCA to go directly authorized to get approved 8%. Thank you for that low. It used to be closer to 50% or 45 50%. Now it's 8%. So it's it's, it's hard to become saying we have no chance now. Nick, me and Nick probably have no chance now. So the fact that we've run a stand and go and you're in and got regulated years ago, I think in our favor, but
Carl Widger:Nick and I, Nick and I, advisors,
Andy Hart:I you know, I'm not going to, you know, get the violin out, but it's hard to become regulated. And once you become regulated, you've got to jump through so many more hoops and the ongoing CPD, it's just there's so many moving parts of it. It's not. It's becoming less and less of an attractive profession, but we're in I don't know, I
Nick Lincoln:don't know. I don't know, I think it's I think it's I think it's way more attractive than it was 20 years ago, I think this this full financial planning business is is a brilliant vocation. Yeah.
Andy Hart:But I mean, it's there's, there's a lot more regulatory moving parts now that Yeah, to navigate a lot.
Nick Lincoln:I would just despite the thing about this sort of bit of separating the financial planning and financial coaching from the implementation, you could be a financial planner, not regulated, you meet a client, you say, Listen, I think if you know, if you need to invest, you've got this 100k, to met to help you drive your financial plan to conclusion, you should go and research and find yourself perhaps a global equity tracker fund on a platform of your choice. And the person says, great, fine, you meet him 12 months later, and you say, Okay, well, can I invest in valuation? And he goes, No, I sold it last because I want a new car. Because you haven't got that. Whereas if the if you're the advisor, you know, when they're looking at their accounts, you know, that they wanted to come through you. It's invaluable. Is that barrier to you're talking about, maybe just talk them off the ledge? And that's why that's why I think is such a synergy between the actual implementation and the financial plan. Okay, it's an 9093 minutes, Christ on our bike, let's move Jesus. Exactly, exactly. This is just whatever
Alan Smith:I think culture I know.
Nick Lincoln:Okay, not being able to scale our business, the financial planning side of it, with any great degree of success is a true point Carl made early one man, he seems he's making quite a good festival is American Peter Luke, the CEO of creative planning. He's always an interesting listen. Big, big firm in the in the USA, and he was on the Morningstar long view podcast, a week or so ago, a link to our inner circle show notes, of course. And he says his firm, everyone does it the same way. And they've got about two and a half 1000 employees as a proper firm, billions of dollars under management. But all clients get the same experience. All the advisors use the same cashflow modeling software. So he seems to have got almost like a turnkey operation. So it's well worth listening to him. And he seems to be one of the more forward thinking is also just an interesting guys. He's just a very good communicator, had a successful entrepreneurial career outside of financial services before going into it. So I would recommend that one.
Alan Smith:That's a good one. And that again, shows that you can although it's difficult scale financial planning, I understand that they really do proper financial planning, Evidence Based Investing all the good stuff was at massive scale whilst
Nick Lincoln:buying I think it's a 30 businesses a year. He's got that going on. I know. He seems to have done it. He seems to be keeping it all. Yeah. Where
Alan Smith:are they not in San Francisco? Kansas? Yeah, the center of the universe where
Nick Lincoln:the deplorables are as the lovely Hillary Clinton once said to her immense loss. Okay, I'm not gonna say the next one is because I know that I'm next
Carl Widger:I'm I'm
Unknown:33 episodes and Carl is ready to go on voice
Carl Widger:forgotten what it is that no. Do business do live Brad Johnson's new podcast, which I think is out for the last year or so. He interviewed Brittany. Hold back. I think her name is um, this lady very interesting. She used to work with Taylor Swift Taylor Swift is the first female billionaire for her music alone, which is amazing. And she was kind of using examples as to how Taylor Swift made kind of raving fans advocates for her music. That's how she built Yeah, Swifties from a very young age, she was like, so on. And she said, this girl just knew what she was doing. But one thing that she was absolutely massively advocating was that, you know, if you want to create raving fans, advocates for your business and financial services, you got to get across your own story, your personal story out there so that people can relate to you. So putting up blog, after blog video, after video about technical stuff are you should go into this phone or shoot, you know, it's not gonna work if people can't relate to you. So I was just thinking in terms of the this group here, like you guys are really, really good at delivering really good content, but also giving a piece of yourself so people can get to know you. And you know, and you all do it in different ways. And it's something I'm encouraging my own team emeritus to do. And it's something I'm kind of gonna launch something over the next couple of weeks, just to give people more of an insight into me into who I am and what my values are and stuff. As Nick, are you sure about this? Yeah. He was doing so. We'll
Andy Hart:have a chat offline. Cole. Yeah.
Alan Smith:Do you have any sort of coaching?
Carl Widger:For guys, right. But no, it's very interesting. People, to, you know, too often, right? We're hearing stuff from a very small group of people about what we should be doing. And it's lovely to get somebody from outside of the industry. Now, she says she does work with financial advisors. But I think it's only a recent enough thing, but a new perspective, to say, here's something that you should be doing at all, because I thought it's really good. I look, I mentioned Brad Johnson before he had a previous podcast, and I can't remember what the name of it was. But it was one it was my go to when I was really trying to rev matters up and seeing how could we kind of develop the brand and that kind of stuff. So I absolutely
Alan Smith:advise a blueprint or something like that. Yes.
Carl Widger:Yeah. Yeah. Yeah. That
Alan Smith:was really good episode. Really
Andy Hart:good. All right. All right. Next, please. Gentlemen, it's over to me. So first up is cereal, which is the blockbuster podcast is back for season four. Contests Guantanamo Bay Prison, Sara kainic. Decent, do check it out. The next one I'm going to be sharing with Mr. Allen Smith, which is called a book that I've listened to an audible called the trading game. A confession by an ex trader, a guy called Gary Stephenson. Your thoughts on the book Hamlin?
Alan Smith:Yeah, I've just read it when I was away last week. No, by the way, have you? I have just briefly, but yeah, it's an interesting book. So Gary Stevenson became, he was he's a sort of guy from the streets of Essex, East London sort of boy. Yeah. grew around, there's quite poignant and awakened and grew up in the shadow of Canary Wharf and all these huge, you know, towers of financial, whatever. And, but was just really, really good at maths. And he won various maths competitions and went through and he kind of knew the game early on smart guy, obviously, based on the book. And I mean, long story short, at the age of he goes to LSE London School of Economics. And he graduates and gets a job at Citibank, the world's biggest bank, and he becomes an expert over the next few years, the most successful trader at Citi Bank. And it's just really interesting, because we all know a bit about this stuff, but it's a real behind the scenes look at what they do and what they do with their kind of FX trades and swaps, and this, that and the other but so what one of the things so he made some days, he traded a trillion dollars in a day. And then he made you know, he made a marginal, tiny slice on that. So I always think on these type of things, one of the thoughts I had was, well, who if he's winning, who's losing is kind of the question, isn't it? There's just Pong. It's a zero sum game and ultimately who's losing is the punters. The pension funds they're everything else. But in summary, it's a it's a worthwhile book, you can sort of race through it at a good pace. I found actually quite poignant and sad at the end because he got wealthy beyond his wildest dreams and didn't really enjoy any aspect of the money didn't spend any of the money kept. I was still buying secondhand bicycles and wearing top man jackets and stuff like that. It's quite it's interesting again, shows you sometimes We'll try to achieve so much and achieve this idea of enough as call says, What's your statement call for you? And again, if
Carl Widger:you don't know what the money is for the answer to how much do you need is always going to be more. always
Alan Smith:going to be more and it will save him and these other guys, these young 2030 year old traders were making millions and it was never enough. And none of them were happy. Insanely. Yeah. Worthwhile book. Yeah. Okay. And I'll just chuck in my final one because we shared that one, just to sort of tie a bow on this whole thing. This when this episode comes out on Thursday morning, later on today, Thursday, is a live webinar with the guys that I mentioned earlier, implement AI ALC, and peers and a real kind of introduction to AI for small businesses. So I'll post a link to it. If you're interested in this. Jump on that webinar later on this afternoon, or register for it and see the recording later. I think it'd be worthwhile. Okay, fan
Nick Lincoln:tastic one hour 41 minutes episode 43 has been flushed down the pan. That is a wrap for this episode. Thank you dear.
Andy Hart:You're sorry, just don't trap live. We've pretty much sold out about five tickets left to grab a ticket. Sorry, final point back to you. Okay, thanks. Come
Alan Smith:to try live.
Nick Lincoln:It's gonna thank you for your time and your input into the show. It is your show as much as ours please do leave a six out of five star review on iTunes. Like and subscribe to our YouTube channel please. That way you'll get a notification. Whenever a show comes out bi weekly on a Thursday. It will land on your PC or on your phone in the early hours of the every other Thursday morning. So until the next time from the Track Pack, it's an EOS and take care of their folks. Goodbye. Goodbye. Bye. Bye.
Carl Widger:Good luck
Alan Smith:Lord God has a lot