In the past three years, one of the most significant things Brett Abikhair has experienced is the power of understanding the psychology of money.
The co-founder and director of The Selector Group (TSG), launched in March 2009, believes understanding the behavioural aspects of finance is the first and foremost skill that needs to be developed in a profession that deals with money.
“Knowing what herd mentality can do to a market is far more valuable than understanding [growth investment models], as evidenced by virtually every major market movement I can remember – emotion rules!” Abikhair tells ifa.
“If you don’t understand where your clients are at headspace-wise, it doesn’t matter what you say – and that was proven during the GFC,” he says. “I had clients telling me that they didn’t know what was going on [regardless of what] we said to them; what they did understand was that I was calm.”
A week after completing his Higher School Certificate, Abikhair joined National Australia Bank and ran his own businesses before joining AVCO, where he got his first taste of grassroots financial advice.
In 1997, Abikhair’s mother was searching for retirement advice while his friends were also looking for assistance with personal finance-related issues, but they were having difficulties finding someone who could help.
He decided he could close this gap in the market for ordinary Australians who were most in need of advice.
“I found a mentor who gave me some guidance,” he explains. “I started studying and five years later I was fully qualified, and in 2002 I started my own business.”
TSG’s business model marries the two pillars of financial planning and mortgage broking to service clients holistically and beyond traditional financial advice, Abikhair explains.
“From the start, we had a philosophy: if you are good enough to develop a relationship with a client, why not do everything you can for them?
“The difference between us and everyone else is that we can deliver on anything clients need as part of their plan ... we have the professional skill sets and qualifications to deliver it all.”
According to Abikhair, many advice practices are challenged by a dual qualification structure due to compliance and licensing needs, but while doing otherwise is a huge commitment, it can be done successfully.
“All of our client-facing team, as they come through, are dual-qualified –usually mortgage broker-financial planners. We combine those skill sets with the licensing and compliance,” he says.
In addition, TSG is supported by specialist teams for the mortgage, financial planning and real estate divisions.
Since its inception, the practice has continued to bring in new staff with little to no industry experience, Abikhair adds.
“We didn’t want any preconceived mortgage or financial planning attitude at all,” he says. “They were fresh and new from the day we started the business.
“When we bring new people in, they go through a structured two-year training program.”
Abikhair believes that instilling the correct attitude and approach into advisers in training produces better client relationships and supports the practice’s priority for ‘money psychology’.
“Financial planning is simply helping our clients understand where they are, where they want to be and how they can get there,” he says. “But it’s not just about money; I spend more time trying to figure out where people’s head space is than discussing investments.
“That’s become my focus now when I sit down with a client – trying to understand what they do and don’t believe about money, what might’ve influenced them in the past and how their parents talked about money with them. From that base, I then start getting a better idea as to where they might want to go.”
TSG hopes that in three years’ time its clients will have become comfortable with staff currently being mentored for higher-touch roles, allowing the practice to operate independently and without the presence and supervision of its head advisers.
Company: The Selector Group (TSG)
Dealer group: Consultum Financial Advisers
Location: Crows Nest, NSW
Platform: IOOF Pursuit
Research: IOOF’s internal team
Staff: 8 in Australia; 6 outsourced in Delhi
Number of advisers: 4 adviser/brokers; 2 contractors
Number of clients: Over 2,000
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