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New Year’s Resolutions

By Martin Bamford, CFP

This is always a great time of the year for a combination of reflection and planning.  I spent an hour the other day looking back through every blog we had posted on our website throughout 2011.  I try to do this towards the end of each year, as a way to remind myself of the highlights and take stock of all we have achieved.  This year, in keeping with every year I have been a Financial Planner, has been incredibly busy.  Only by pausing to review everything that took place can I make any sense of the constant barrage of news and achievements the past twelve months have had to offer.

After looking back, we start to look forward. Despite their inevitable short shelf-life, I like to set a small number of New Year’s Resolutions in time for the start of January.  These are often a mix of personal and business resolutions, and are based on the things that I want or need to change in my life.

Personal Resolutions

On the personal front this year, my resolutions will include spending more time in the great outdoors (there is a big kayaking trip I want to complete this summer) and entering more photography competitions.  I also plan to lose a bit more weight in 2012, after dropping around a stone in 2011 (and feeling much better for it!).

Business Resolutions

My business resolutions could present a bigger challenge than those I have set personally.  Some of them – including spending less time in meetings – are entirely within my control and have worked well over the past twelve months, resulting in better results and less stress.  The light bulb moment I had on reading the book ReWork by Jason Fried (that meetings are generally toxic and a waste of time for all concerned) meant I have been able to spend more time on the activities that get results.

2012 is going to be a very difficult year for lots of Financial Planners in the UK.  It’s the final twelve months before a major new set of regulations get introduced and, for many financial advisers, a big part of the year will be spent scrambling to meet the new regulatory requirements.  Having met those new standards years ago, one of our business resolutions for 2012 is to make the most of the year, taking advantage of all of the opportunities that arise.

Bad Economy = Opportunity

Whilst the economy looks set to remain in the doldrums, there are opportunities at every turn, as long as you are prepared to work for them and deliver an excellent service to clients.  The baby boomer generation is reaching retirement age, releasing vast amounts of wealth and requiring assistance with their financial planning.  Our ageing population is raising more queries about the best way to structure assets and funding care fees in later life.  Many advisers are choosing to retire early, presenting opportunities to acquire their clients and grow the business that way.

The frustrations in 2012 are likely to come from the events outside of our control.  A big issue we face currently in the UK is paying for the unsuitable advice provided by others. Our industry funded compensation scheme is currently picking up the tabs for some big investment failures so, despite not recommending bad investments, we have to pay towards compensation for the clients of other advisers.  In the first few months of 2012, there is a good chance we will be picking up the tab for the failure of MF Global, including payments towards compensation for US investors, due to the way the scheme was structured here in the UK.

Accepting that costs such as these are outside of our control, the best we can do in 2012 is focus on all of the opportunities and try not to let the bad stuff result in too much stress.  That doesn’t mean we have to like it, but it must not distract us from the business of achieving an even more successful year in 2012 for our business and for our clients.



2 comments to New Year’s Resolutions

  • Hi Martin,

    What are the salient features of the new regulations and who does it impact most ?

    My lack of understanding of industry funded compensation schemes in UK makes me ask as to why would you folks pay for failures of others ?

    Have a Happy 2012 !

  • Thanks for your questions, Radhey.

    The new regulations, which come into force on 31st December 2012, cover three main things – higher minimum qualification standards, the abolition of commission as a remuneration option and a clearer definition of ‘independence’ in terms of service provision.

    On paying for the failures of others, that is a very good question! Our industry funded compensation scheme (the Financial Services Compensation Scheme) is essentially a big mess. Different firms are placed in various sub categories, with other firms in the same categories having to fund failures up to a certain level each year, at which point the cost spills over into all firms.

    We ran a big campaign against the unfairness of the scheme this time last year, which is slowly forcing some changes to its structure. I think having to pay US investors for the failure of MF Global would represent the final straw for many UK advisers.


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