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Paraplanners – six reasons why your firm needs one

Six key paraplanner attributes or reasons why firms looking to grow and increase profitability need a paraplanner on the team

Patrick Ingram, head of corporate relationships at Parmenion, considers what he and the company have learned about paraplanners as judges of the IFP Paraplanner of the Year award over the past three years.

It is clear from our judging of the IFP Paraplanner of the Year award over the past three years that good paraplanners add an extra dimension to the financial planning process and the very best paraplanners transform it to something very special indeed. While the reality is that very few advisers are fortunate enough to see these aspects of added value. There is a serious shortage of qualified and experienced paraplanners, and very few in need of extra work, it’s worth setting out how the best paraplanners work with their advisers, to share this insight into what benefits their involvement can provide.

1. Technical ability: Paraplanners characteristically pride themselves on their product, tax and pensions knowledge, enjoy the opportunity to research new solutions and maintain due diligence of existing aspects of the firm’s proposition. This sets the advice process on a firm, factual foundation.

2. Administration: There is a subtle art to making admin look effortless and it is something to do with the paraplanners love of detail and concern to double, double check their facts. Give a good paraplanner a pile of disorganised paperwork and watch it become a lucid set of action points in support of a client report.

3. Maintaining the financial plan: Constructing a coherent financial plan is a task of two or more days in length in many cases, and this is where the paraplanner starts to build the picture of the client’s future and options which the adviser will deliver. In the client meeting, the planner is often on hand to handle ‘what if’ questions and to clarify points of detail.

4. Communication: It is a misconception that paraplanners want no client contact. Some don’t have quite the level of developed relationship building skills that are required of successful advisers but good paraplanners have the talent to present complexity with clarity in reports and in presentations.

5. Challenge: In selecting winners for the IFP Paraplanner of the Year award, it’s always the case that the judges look for individuals with the strength of character to challenge an adviser on their thinking around what approach to take with recommendations to clients. Paraplanners are not in post to make life easier for ‘product salesmen’ and independence of thinking shows itself repeatedly to be valuable to both good client outcomes and to mitigating compliance risk around advice.

6. Realism: It’s an old saw worth repeating, that a financial plan is only as good as its assumptions, but going further it also has to make sense and be realistic in its conclusions.

To summarise, in partnership with their paraplanner, the adviser is freed up to concentrate on maintaining and creating client relationships and to deepen the firm’s insight into the specific personal issues that lie behind the numbers in the financial plan. This can be advantageous from a business perspective if it allows the client base to grow or if it facilitates a higher level of service to more demanding clients. This is a classic example of an efficient and productive division of labour, into respective specialisms. With the support of an able paraplanner, we see advisers delivering their key elements of the advice process, with greater confidence and speed, in a more profitable business context.

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