There’s so much negativity surrounding the financial planning industry these days that I wanted to champion the hard work and dedication of financial planners. John Walker from Optimal Wealth Solutions, sat down with me to discuss his practice and his insights into the future of advice.
Scott: Thanks for sitting down with me. Let’s start off with why you became a financial planner.
John: I previously worked for global banks and mainly health with large corporates where there was no real client interaction. I found with financial planning my skills were largely transferable and I was able to get closer to my clients. It’s a lot more client focused and more enjoyable in that sense.
Scott: Yes, I can definitely relate to the lack of client interactions in large corporates, and this was also a key driver in becoming a financial planner myself. Through my experience, I found that insurance was a big area of someone’s life that they usually neglected until it was too late. Tell me about your insurance philosophy.
John: I think everyone needs good quality insurance – by that I mean that the insurer has an excellent claims record and the insured amount will be enough to maintain their existing lifestyle and to keep their wealth accumulation plans on track.
Scott: Absolutely. What are your thoughts on investment strategies? I always found that this is something that people should start doing as soon as possible, especially if they wish to retire comfortably.
John: I am a firm believer that the investments need to be well diversified with managers that have an outstanding track record of being the index over the long term. At Optimal Wealth Solutions, we tend to use a core plus satellite approach which reduces expenses but also allows for long term outperformance for our clients. There’s also no such thing as a set and forget investment strategy.
Scott: There’s so many financial planners in Australia, what separates you from the rest?
John: We spend a considerable period of time in finding what is important to our clients and deriving wealth accumulation and protection strategies around those priorities. We work on an ongoing service basis so that we are there for our clients at all times. We are actively involved in the management of a clients’ super and investments.
Scott: Uncovering the key drivers for your client definitely helps in understanding how they make decisions and their value system. Given your extensive experience in the industry, you have clearly helped a lot of people. What’s been a highlight?
John: It’s been great dealing with clients that have no interest in finance where they might have four or five super accounts, really poor insurances, no financial plan and are just stuck in a rut. It’s fantastic when they get interested as it can be real life changing as their financial literacy and circumstances improve dramatically.
Scott: Who is your ideal client?
John: My ideal client can be of any age or financial situation. I love dealing with clients that are ambitious and want to improve their life through hard work and quality advice. They are also prepared to take a long-term view and strive to achieve their goals in life.
Scott: Excellent and over your career as a financial planner, how have you seen the industry change? Is it for the better or worse?
John: It can be argued the industry is worse off as a result of excessive regulation and administration that has significantly increased the cost of advice meaning advice is probably not available to those that need it most. On the positive side, the increased regulation has given better protection to consumers. Over time, I see good times for the industry as there will be well-educated and more aligned financial planners using better technology for the benefit of clients.
Scott: I believe there needs to be a higher level fo transparency in advice, however, my fear is that because of a few bad eggs, a lot of great planners with be punished for their mistakes! Where do you believe the industry is going?
John: The industry is definitely contracting with a lower number of financial planners, but those planners will be better qualified and client centric – this can only be a good thing for clients over time. To fill the void, the industry needs to be rewarding enough for new well-educated planners to enter the industry.
Scott: With the increasing paperwork that financial planners have to complete just for simple advice, what are your thoughts on technology in advice?
John: Advice is becoming less and less affordable and the time constraints on planners are becoming overwhelming. Any technology that is able to reduce the administrative burden on planners and free up time for planners to spend more time with their clients will allow them to devise better and more successful strategies.
Scott: Well said. In your opinion, how can tech companies better assist financial planners in today’s climate?
John: The biggest complaint for all planners is the admin burden – any technology that reduces that burden can only be a win-win situation. It would also be great if there was a tech company that had a platform where all your requirements were in the one place instead of going from one platform to another for client data, insurances, super, investments etc.
Scott: There definitely needs to be more focus on reducing the admin burden for financial planners. John, thanks so much for sitting down with me to share your insights and business practices.
I hope you enjoyed reading this. At Asendium, we love to champion people who are making a contribution in the world. Let us know who you would like to hear from next.