On the Spot: Rebecca Taylor FIFP CFP^CM

The IFP’s Accreditied Financial Planning Firms’ initiative will give planning businesses public verification that they have met the high standards of the IFP. We talked to leading Financial Planner Rebecca Taylor, one of the architects of the accreditation process, about what it will mean for firms.

Financial Planner: First Rebecca, for those who do not know you, can you tell us a little about yourself, your background in Financial Planning and how you came to be involved in this initiative?

RT: My background in Financial Planning started in early 2005 when I first joined the IFP as a member and immediately started the CFP^CM certification process. By going through the process and talking to others, it gave me the confidence to start changing the business quite radically, something that I had been thinking about for some time, but not really knowing which direction to take. Nearly seven years on and Dunham Financial is a Financial Planning business as opposed to an ‘IFA’ business, along with a dedicated team that thrive in providing this highly personalised planning service. I became a Fellow of the IFP in 2007 and then in 2009 I was elected to the board of directors to the IFP, hence my involvement in this initiative.

FP: Why is the IFP launching this initiative now?

RT: The idea of a Financial Planning firm has been around for many years, but as you can imagine, takes a significant amount of time to put together even a basic template as to how an Accredited Financial Planning firm should look. Not to mention of course, the strain on resources with everything else going on at the IFP, RDR, Gapfill, Statements of Professional Standing and so on!

FP: What will be the main criteria used to assess which firms qualify as Accredited Financial Planning Firms?

RT: The simplest way to explain the criteria, would be to say that the firm must be a Financial Planning firm! Looking within this, one of the main points would be to look at whether a firm uses cashflow modelling for their clients. It doesn’t have to be in a prescribed format, or with a recognised piece of software, but it does need to be there. From the discussions that I have been part of, this was the one constant that everyone agreed without questions was a vital component.

FP: Why do you believe it is important to recognise firms that do comprehensive Financial Planning in this way?

RT: Clarity. The waters have become muddied with various companies using different titles in an attempt to differentiate themselves, to the point where we have bank advisers being known as Financial Planners, even though the client experience with a bank adviser is highly likely to be completely different to that experienced by a client of an Accredited Financial Planning Firm. Having been through the traditional work pattern of tied adviser, IFA and then Financial Planner, I can see very clearly how different the services are.

FP: How will this initiative help consumers and how will you explain to them the value of accredited status?

RT: Unfortunately the general public is mainly unaware of Financial Planning, unless they are already a client of a Financial Planner. As many of us know, Financial Planning Week is aiming to redress this and the Accredited Financial Planning Firm will help to take this message to the consumer as well. Once this education direct to the consumer begins to build momentum, we need to make it easy to find someone who can offer a genuine Financial Planning service which, along with the CFP Professionals’ Register, is where the Accredited Financial Planning Firm comes in. There is currently nothing available that I am aware of that effectively screens a business so the client can approach an Accredited Firm with confidence in the services offered.

FP: Some critics may say this is just a marketing or branding exercise. Does it actually reflect the quality of the principal’s staff and client offering?

RT: I am sure the more cynical out there will say this is a marketing exercise! In all seriousness, only a firm which can clearly demonstrate a quality Financial Planning Service will qualify. The application process, whilst following a ‘tick box’ format then requests examples of various documents, from a sample Financial Plan to their Investment Philosophy.

FP: What benefits will this initiative bring to accredited firms themselves – do you believe it will help them in business terms and, if so, in what way? What’s the long term aim?

RT: I believe over the longer term the firms will gain a marketing benefit, as one of the principle aims is to take the initiative to the public as well as providing a register so that a potential client can search for a genuine Financial Planning company.

FP: What are the main differences between the IFP’s Accredited Financial Planning Firms initiative and Chartered Financial Planner firms?

RT: A key difference is that we require all practitioners providing the Financial Planning service to clients to have an advanced level Financial Planning qualification - CFP certification of AF5, or be directly mentored by someone with those credentials so consumers know that they are dealing with someone appropriately qualified or mentored. Chartered Financial Planner firms need to provide consumers with access to a Chartered Financial Planner but there is no guarantee for consumers as to the qualifications or credentials of the individual from whom they receive advice who may, or may not, be qualified in Financial Planning. The IFP requires Accredited Firms to clearly demonstrate that they offer a Financial Planning service in line with the six stage Financial Planning process.

FP: If Financial Planning Firms want to seek Accredited status what considerations should they undertake first and how do they start the ball rolling?

RT: The first and foremost consideration is to look at the six step Financial Planning process and see if this is broadly how your business operates. This will be a good guide to begin with. Next we are looking at the Financial Planning fundamentals as mentioned earlier, such as cashflow modelling and a consistent investment approach. If planners have a business that offers a range of services, we would be looking for the Financial Planning division to be clearly visible compared to the rest of the business. At the time of this interview, the ball cannot quite get rolling just yet! Watch this space though for details of how to apply as we will be looking to announce the first 25 Accredited Firms at the IFP conference this year, celebrating 25 years of the IFP! It will be quite a milestone for the profession.

FP: What is the process to become accredited for firms and how long do you expect it to take?

RT: The process is a simple application form with supporting documents. If your firm already meets the criteria it is likely that all of the documents requested will be readily available, so it should not entail a significant level of work. In addition there will be some visits, either for those businesses that don’t have the documentation to hand, or maybe those that haven’t quite demonstrated that they can meet the criteria and a business visit takes some of the hassle away. Of course, there will be some random checks, just for quality control and audit purposes, as one might expect. The aim is to ensure continuous quality in terms of what a client can expect.

FP: Financial Planning firms come in all shapes and sizes. Is the initiative able to accommodate different size firms and is it more appropriate to small, medium-size or large firms?

RT: Most definitely any firm can apply for Accredited status. We are conscious, however, of not being too prescriptive about how people run their businesses. We are looking for the core principles to meet our criteria, not how this is put into practice. The only distinction we are making is for firms who have other divisions, to show how the Financial planning division is clearly visible separately. We wouldn’t wish for a client to call - having found the firm on the Accredited Firms register - only to be put through to the transactional/ mortgage adviser or someone who was not appropriately qualified.

FP: Will your firm be applying for Accredited status?

RT: By the time members read this we’ll be looking at the detail as the register will launched, or will be launched soon after. Watch this space!

FP: When firms become accredited what do they get, for example logo usage, listing on a directory and so on and what are the costs involved in applying?

RT: Accredited Financial Planning Firms will be listed on a directory and there is also a logo that will be available for use by accredited firms. The base cost is £750, plus a cost per planner with discounts for IFP members.

FP: Is the accreditation process an annual one and can firms lose accreditation? If so, what happens to them?

RT: Yes, it is an annual process and it is possible to lose accreditation if you no longer meet the criteria or stop offering a Financial Planning service. It is unlikely that this would happen if firms have committed to Financial Planning and continue to offer a Financial Planning service, but it could happen. In this case they would be removed from the register and no longer able to use the logo or promote themselves as an Accredited Financial Planning firm. We hope that firms will choose to see Accredited status as a long term benefit for their business and will remain Accredited.

FP: When you are not campaigning for this initiative how do you relax during your time off?

RT: Time outside of the office is quite busy still! I spend a lot of time with my horses which is very relaxing and the rest of it is either spent training or racing on my bike! I also enjoy reading and watching films.

Rebecca Taylor FIFP CFP^CM

Rebecca is managing director of Dunham Financial Services based in Peterborough. The company works with both individuals and companies creating long term Financial Plans. As a CFP professional and Fellow of the Institute of Financial Planning, Becky is a strong believer in the six stage Financial Planning process. She was the founding chairman for the East Midlands branch and sits on the IFP Board of Directors.