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Person receives financial planning advice

From time to time, we get asked why people should be pay fees for financial planning advice. To be honest, it baffles me why people should expect a financial adviser to offer free services.

I believe that this is due to many misconceptions, and here just a few:

  • We are paid a commission by the companies that we advise you to invest in
  • Banks offer free ‘advice’ so why shouldn’t everyone?
  • There’s so much information online, freely available knowledge doesn’t require paying for

All of these assumptions are myths, and as the saying goes, ‘there’s nothing more expensive than free advice’.

Financial advice and fees

Independent financial advisers and planners charge fees and are only allowed to receive commission from insurance and mortgage providers.

As you’d expect we must have professional qualifications. In addition, we must continuously evidence ongoing study in the form of continuing professional development (CPD) to our professional body. This all makes sense, as you certainly wouldn’t trust your retirement to someone who doesn’t have any relevant qualifications!

All financial advisers must also have a Statement of Professional Standing (SPS). This is applied for each year to allow us to be able to give regulated financial advice. To apply we must evidence a minimum of 35 hours CPD for that year.

Financial planners start as trainees and work alongside experienced advisers for a set period. During that time, they must study outside working hours to pass examinations and coursework. Once trained, we undergo annual testing to ensure that our knowledge is continuously up to date.

Our knowledge and understanding of finance are why you pay fees. In in that respect we are no different than a solicitor or an accountant; you are paying for experienced advice.

Be held accountable

Our clients are also paying us to hold them accountable to their financial plans. We help stop them making rash decisions which could scupper their plan. We also keep them calm in times of trouble.

It is by doing this that we are confident our clients will be better off financially in the long term. As a consequence be able to make better and more informed lifestyle decisions.

We love working with our clients, and seeing them achieve their goals is priceless. But for us to delve into your finances and get to know you and what you want to achieve takes time. It also requires effort and hard work from our whole team.

Independent financial planning

When choosing a financial planner, find out what service they offer first. Is it full holistic financial planning or simply product advice? Ask them what their services will do for you. It is also important to ask them if they can offer independent advice or restricted advice. Restricted advisers are nearly always tied to a single provider such as a bank.

In my experience, this generally means they are less concerned about your ongoing costs and more concerned with selling you something.

Co-Navigate’s financial planners are exactly that, planners. We will only recommend a regulated financial product if it is necessary to be able to carry out your financial plan. We are also independent, meaning when we do make a product recommendation, we are doing so having researched the entire marketplace on your behalf.

After our initial discovery meeting which we provide at our own expense, and assuming we both agree to work together, we spend hours building a picture of your finances and linking them with your goals. And once in place, we regularly meet our clients to review their financial plan and adapt it where necessary.

Banks and ‘advice’

I believe part of the confusion is due to people historically visiting a bank or building society for ‘advice’. A phone call from the bank manager asking to see you used to be quite a daunting thing. Invariably, most people accepted the invitation. Having been ‘on the other side’, I now know that this has been a good sales tactic by the banks. As a result, they were able to get in front of their customers and sell them more products.

They may listen to you, but they will not provide a financial plan that helps you achieve your goals. Instead, they will give you the information about their products and then it’s up to you to assess which product meets your needs. But none of this has anything to do with financial planning and everything to do with buying a financial product.

Online financial planning ‘advice’

If you Google ‘best pensions’ or ‘best investments’ you will get a lot of information. This may be useful for signposting, but is so generic that it can never be called ‘advice’.

Everyone’s situation is different, particularly when it comes to finances. Your financial goals will be as individual as you are, so general information is not always helpful and can sometimes even be harmful, costing you much more in the long run.

Most people looking for help with their finances recognise that they must pay their adviser for their time and expertise, and that financial planning is much more than simply choosing a pension. I hope that this brief overview shows you why it’s money well spent.

To speak to us about our financial planning advice services, contact us today. You can also contact our Newcastle office on 0191 228 6130.

This is Jamie Bogle, Co-Navigate's Financial Planner, Co-owner and Director

The final interview with our directors is with Jamie Bogle. He is Co-owner of Co-Navigate along with fellow founder Andy Mathers. After lots of experience in finance, he now enjoys the fact he can shape his own destiny as a business owner.

Name

Jamie Bogle

What is your position at Co-Navigate?

Financial Planner, Co-owner and Director

Why did you choose a career in financial services?

I always wanted to work in finance. At university, I did a law degree, but I always knew I’d work in finance in some capacity. I worked for Barclays before I went to university as a cashier and got summer placements there while at university. I liked the finance side but mainly talking to customers and helping them with their money, that’s what I really enjoyed.

What is your experience?

After university, I worked in London for HMRC in employer compliance, but I didn’t enjoy working in the civil service with its mentality. I found it frustrating! From there, I saw a graduate financial adviser trainee position with the Co-operative Insurance Society (CIS), and I successfully applied. I looked after both insurance and financial advice. Again, I really enjoyed talking to people and trying to help them, I just didn’t enjoy the pressures of having sales targets. From there, I moved on to be a mortgage adviser at my uncle’s firm. That was also my first taste of self-employment. I worked there for 7 years, first as a mortgage adviser and then as a financial adviser. Then I spent 4 years working as an IFA (independent financial adviser) with a national firm, and it was during this time when I worked with Andy that I realised there is much more to financial advice than simply selling products. I wanted to help clients with their financial decisions and use more complex cash flow forecasting tools. We couldn’t do that where we were, so Andy and I decided to launch our own independent business, Co-Navigate, in order to help serve our clients better and design our own processes for delivering financial planning advice. I’ve been in finance for nearly 20 years now, and the time has gone quickly!

What do you enjoy about your job?

I really enjoy seeing clients! There is a lot of paperwork and reports to write, unfortunately, but meeting clients is what makes this job so enjoyable. During lockdown it has been more difficult because you’re just seeing them virtually rather than face-to-face and I really miss that. However, seeing clients embracing technology has been really helpful so we can continue to serve them. I also love having my own business as it allows me to be in charge of shaping my own destiny.

What key advice would you offer to a potential client to Co-Navigate?

Always invest according to a plan and don’t worry about short-term events that will inevitably try and get in the way. Just don’t get distracted from the plan.

Favourite colour

Red.

Favourite music

I’ve got a very broad taste but my favourite musician is Ludovico Einaudi. I’m also a big fan of Amy Macdonald and Kate Rusby.

Hobbies and interests

It’s got to be football. I love playing it, especially my weekly five-a-side. I’m also a season ticket holder at (dare I say it) Sunderland and go there with my daughters. I also enjoy cycling and quite often ride into work and back.

Andy Mathers Co-Navigate Director and Financial Planner

As part of a new series, we are introducing the people behind Co-Navigate. You may have already met the Co-Navigate family on our ‘Meet the Team’ page. But what makes them tick? And how did they move into a career in financial planning?

First of all, we meet Andy Mathers…

Name

Andy Mathers

What is your position at Co-Navigate?

Financial Planner, Co-owner and Director

Why did you choose a career in financial services?

I pretty much fell into the career. I did my degree in economics and worked for two years at a church. During that time, I was buying my first house and when I spoke to someone at the youth group he asked if I wanted to speak to his dad, who was a mortgage adviser. I went to see him and six hours later he offered me a job! I shadowed him for two weeks and as I have a geeky mathematical brain and it’s a people-related job with maths thrown in, I absolutely loved it. That was 22 years ago!

What is your experience?

Initially, I was a general adviser, working with mortgages, investments and pensions. In the past 10 years I have focused on investment and pensions. Pretty much all my clients are medical professionals, that is my speciality now.

What do you enjoy about your job?

The key bit is helping people make the most of their finances and make good decisions. People worry about talking about money and the future. What we hopefully do is give them a sense that they are in control of their finances and make wise, educated decisions, such as, ‘Can I afford to retire a year earlier?’ It gives people the sense of freedom as some people feel guilty about spending money. But when it’s planned and you can afford it, it frees you to enjoy your money guilt-free. It’s not just financial, it’s life planning to help people make good choices.

What key advice would you offer to a potential client to Co-Navigate?

Don’t bury your head in the sand! A problem shared helps deal with it in a very positive way and you don’t feel worried about it. Talk to us about your financial planning. We help people understand what their finances look like and help look forward in a positive way. Our clients have real certainty for the future, which helps people make good decisions rather than fear or worry about it.

Favourite colour

Blue.

Favourite music

I don’t really get chance to listen to music as we have 3 daughters. When we get in the car I don’t get chance to choose as it’s usually Tik Tok at the moment. My life has been ruined by Tik Tok! I do love jazz to relax to.

Hobbies and interests

Faith is really important to me – I’m actively involved in our local church. And I love hockey. When we’re not in lockdown I am playing hockey 6 hours a week. That’s 4 hours of practice and 2 hours of playing.

Why we are planning to launch a project about teaching children about the value of money

Would you consider teaching your children the value of money? If you answered ‘yes’ it seems that you are not alone.

Getting to grips with maths is important, but many people say they would have preferred to have learned about handling money at school than the intricacies algebra. At Co-Navigate we’re passionate about showing people how planning their finances can help them reach their life goals.

But just imagine if that happened to you when you were younger. Setting up your first home would probably have been a easier if you had learned about budgeting at school. 

The earlier you look at your life goals and start planning, the easier it is to achieve them because of the extra time you have. So teaching children and teenagers about the value of money would be useful, we think.

Money Masterclass poll

It is why we decided to ask our social media followers what they thought of the idea of Co-Navigate designing Money Masterclasses for young people. And the resounding answer was that they thought it was an excellent idea. A poll showed that 90% of our followers would be interested in Money Masterclasses! 

The inspiration behind it followed a video chat we had a couple of weeks ago about an article that one of the team had seen in the FT. It was a personal feature about how lockdown had given a parent the perfect opportunity to teach their children about money.

It may not sound very exciting but if you make it interesting then it can be quite exciting.

Children and the value of money

The writer talked about the importance of pocket money and household budgeting. It included showing children modern ways of paying pocket money, such as via the contactless card for children, GoHenry. Board games such as Monopoly also featured as a great way to teach children about valuing money.

Of course, savings were also discussed, such as Junior ISAs, to illustrate to children the importance of saving.

As the feedback from our poll was incredibly positive, we’re now working on plans for Co-Navigate Money Masterclasses. Please bear with us! As well as running the business, a number of us are also juggling homeschooling. But we do plan to look at the idea over the next few weeks.

If you would like us to keep in touch with you about Money Masterclasses, then please sign up to our mailing list. We don’t sell or pass on your details, nor do we bombard you with emails! We’ll just let you know when Money Masterclasses are rolled out.

Couple plan finances for tough times

As the coronavirus lockdown continues, how are you managing with your finances in these tough times?

Many people are facing a few weeks, potentially months, where income may fall due to being furloughed or having their hours/wages cut.

At the same time, investments are reacting to stock market volatility while savings attract little interest.

With finances, the answer is always preparation. Having a plan in place that considers all kinds of scenarios is one of the foundations for financial planning at Co-Navigate, including tough times.

Even if the worst happens, by having something in place you won’t worry as much because you’ve already considered the situation and will have a plan.

Your task list

  • Finding savings in your budget
  • Making some cash if your hours are reduced
  • Protecting your credit score
  • Prioritising your bills if you can’t cover everything
  • Thinking through your next move if you lose your job

Look at your spending

Having a budget means you are aware of where your money is going so you can adjust it when needed.

During times of regular, uninterrupted employment it can be easy not to think about budgeting, but if you can work on your budget now, you’ll be better prepared for most eventualities.

If you’re unsure about what should be included in your budget check out an online planner like this one from the government’s Money Advice Service.

Once you’ve worked out where your cash is going you can spot spending that can be trimmed or removed. If you can save some money you can build up an emergency fund.

You don’t need a lot for an emergency fund, although we do advocate trying to save at least 3 months’ income to see you through the tough times.

Make some extra cash

This suggestion isn’t as crazy as it seems. Have you got a hobby you can make money out of? After all, this is how most successful businesses get started.

If you’ve got the materials and can make something that you can sell online, then that could bring in a bit of extra cash.

How about your current job? Can you turn your knowledge into an online course that will help others develop their skills?

Teachable allows you to set up everything you need for just over £30 a month. It could be a good investment if you can attract 5 people who pay £30 for your course. Not only will you cover the cost you will add a little bit extra to your income.

Protect your credit score

Be careful with credit cards during the lockdown. Retail therapy online might give you some pleasure but don’t allow it to cost you your future.

If you’re used to paying off your balance each month, don’t worry about having a little bit on your card. Make sure you don’t exceed your limit and if you need extra time to pay contact your card issuer as they may give you leeway during the Coronavirus.

You could switch your card to one offering 0% on balance transfers for a year or two, which would make your money go further. But beware think about credit checks and remember that having multiple credit checks can impact your credit score/rating.

Safeguarding your credit score is essential because having access to credit can help you navigate through unforeseen tough times.

Prioritise your bills

When you have a reduced cash flow unexpectedly, bills you’d normally pay without hassle may be more difficult to manage.

Look at your survival at first in these cases. You need to cover your food, home and utility costs first. After you meet those costs, you can then prioritise other bills.

Business owners are used to speaking to creditors to reassure if they hit a rough patch to extend terms. Try this in your personal finances too. If you deal with it head-on it’s better than receiving a letter and problems later.

Think through your next move

Industries that would normally get by in a normal recession could be hit badly through the coronavirus crisis. As a result, no profession is safe from job losses, sadly.

If you’re fearing for your job or business, don’t panic! If you have a game plan in place you won’t end up with brain fog should the worst happen.

For business owners there is lots of support around to try and help you through this difficult period. You can find more help here https://www.gov.uk/coronavirus/business-support

If you’re employed but on furlough, update your CV during lockdown and use online networking, such as LinkedIn, to catch up and create new connections. Who knows where it might lead?

Our ethos at Co-Navigate is try not to panic. Our financial plans build in worst-case scenarios so that you always have a back-up plan and financial security.

We would urge you to do the same! During lockdown spend the extra time at home to plan for the unexpected… then it won’t be quite as unexpected, and you’ll feel more in control.

If you’re still concerned during these tough times, why not get in touch?