In an environment grappling with issues of conflicted interests and product pushing, Momentum Planning’s directors tell ifa how they found success in empowering clients with more choice.
After six years of working for product-based, insurance-focused advice firms, Philippa Elliott, founder of Momentum Planning, finally had enough.
Realising that her passion for providing holistic advice could not be pursued at the firms she was working for, Ms Elliott decided to branch out on her own.
“At each of the businesses I had worked for in the past, it was very much about selling clients products that they often didn’t even understand,” Ms Elliott says.
That is what led to the founding of Momentum Planning - a practice built on the goal of giving client’s more choice. Ms Elliott says the only way people can make the best decisions is when they are aware of all the options.
“There is never just one way for a client to get where they want to go, and we have no predispositioned plan for them,” she says.
“It was always going to be crucial to the business that we chose who we worked with, but also that the clients who came to see us were always provided with choices and very much aware of every single option available to them.”
Supporting women and Millennials
Beyond empowering clients through choice, Momentum Planning is an advocate for more women in financial advice as well as advising Millennial clients.
Momentum Planning is known for its all-women staff. While this did not happen by design, there is a need for more women in advice roles, says the firm’s director and adviser Amanda Jarosz.
“There is a gender imbalance in advice and while there are a lot of women taking up support roles in the sector, we’d like to see more women in advice roles,” she says. Ms Jarosz added that mentoring and awareness play a big part in addressing the industry’s gender imbalance.
“When I left school I didn’t know what I wanted to do. I didn’t enjoy university. I started work in a real estate agency and then took up a support role within a credit union,” she says.
“If it wasn’t for internal recruitment opportunities that I was made aware of within the credit union I was working for, I would never have had the chance to develop an interest in paraplanning, which has led me to where I am now.
“So mentoring and awareness are really crucial and it’s important to get out there and ensure that women are being made aware of the options and choices available to them as advisers.”
In addition to its advocacy for women, Momentum Planning has a strategy in place to target the millennial generation by supporting the children of its clients.
“Although we don’t want to build a model specifically for that generation, we are very aware that looking after our clients’ children is really important,” Ms Elliott says.
“We have put in place a service for our clients’ children who are under the age of 30 to give them some cash flow, insurance and super advice at no cost.
“When the time is right and those children do need access to more detailed, holistic planning, hopefully we would be the door that they knock on.”
Working alongside ‘black sheep’
Despite many professionals making a positive impact on client finances, Ms Elliott says the sector is still struggling with a number of ‘black sheep’ racking up a bad name for advice.
Ms Elliott points to the experience of one of her new customers who was previously forking out $16,000 a year for financial advice.
“All that the customer received for that amount in the last 12 months was an asset allocation and a budget update on their annual review. Our average fee for clients here is around $6,000 to $7,000 per annum, and the amount of work that we do is extremely comprehensive,” she says.
“To see that there are still practices out there that think it’s ok to charge people that much money for delivering so little just gets my blood boiling.”
While instances like these make it difficult for advisers looking to defend their profession’s reputation, opportunities arise when clients look to advisers they can trust.
“I guess that does represent an opportunity, in a sense, for those of us who are building a different advice model - the problem is that in some cases consumers are so unaware and they take it for the norm,” she says.
“Advice is about making sure clients have the tools to make really good decisions, not just taking a cut of their money.”
Meanwhile, when it comes to the future of Momentum Planning, Ms Elliott says the plan was never to build an empire.
“I always wanted, from the very beginning, to have a small business. The slogan at the beginning was ‘fewer clients, better service’,” she says.
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