Why coronavirus will change the advice profession forever

As the Covid-19 pandemic continues and the country adapts to new ways of living and working, Tim Sargisson explores what this will mean for the advice profession...

As more and more people and businesses across the country are impacted by the coronavirus (COVID-19) many of us will be wondering what the world will look like when we are through this and out the other side.

Continuing the theme of stating the bleedin’ obvious, firms in the strongest place before this crisis and who continue to support their clients over the next few weeks will be best placed to get through this. For example:

The continuing upheaval in global stock markets demonstrates the need for all partners to provide words of reassurance at this time. The importance of how we communicate in the coming weeks and months will either enhance our reputation or significantly damage it. There’s probably no middle ground.

When it comes to communication, advisers must accept that clients will be reluctant to arrange a face-to-face meeting over the next few weeks and possibly months. Many advisers still prefer this approach, but we must be realistic that this might not be an option for weeks or months to come.

Again those firms with great technology provides the firm with numerous channels to communicate with clients. Firms with a dedicated wealth platform will know that this provides an excellent way for keeping clients up to date and not just at times like these.

Finally, I can’t let this go without highlighting another factor close to my heart. The FSCS’s forecasts for the levy 2020/21 is estimated to be £635m, up by £87m on the total for 2019/20, with advisers expected to pay £213m towards the levy for the coming year, almost 13% more than the previous year. The main driver for this increase is compensation paid for SIPP-related claims.

The brutal fact is that poor advice has placed an intolerable financial strain on the advice community over several years and Coronavirus means that for many firms that position will worsen. We would be so much better placed to weather this storm with the money in our bank account rather than disappearing to fund the FSCS.

The good news is that we will get through this and we will get through this together. For now, we must ensure we are all in the best possible place to weather the storm that lies ahead and provide the help and reassurance that our clients expect of us.

Tim Sargisson is chief executive at Sandringham Financial Partners