In my recent glance through the “pinks” I have found the following facts, none of which came as any surprise:
- RDR has resulted in squeezed profits for advisory firms, forcing many advisers to leave the industry altogether.
- Claims management companies seem to be encouraging clients to make spurious complaints against advisers in the hope that even if the original complaint is not upheld, the Financial Ombudsman Service will find something else in the client file that will result in compensation. Whether or not any complaint is upheld, the adviser still, of course, has to foot the bill.
- In contrast with most other professions or industries, there is no time limit on when our clients can press claims for compensation if they believe they have been given poor advice – even if the adviser has long since retired.
- It is becoming more and more difficult to find new clients ready to invest and willing to pay for financial advice.
- The typical sale value of an advisory business has plummeted by nearly 40% since RDR.
So, should you be optimistic or pessimistic about the future?
The reality is that you are either an optimist or a pessimist, regardless of the challenges you may be facing.
Let’s put things in some perspective. On Sunday (23rd February 2014) Alice Herz-Sommer died at the grand old age of 110. Alice lived through horrendous experiences in the Theresienstadt death camp. Her mother and her husband were murdered by the Nazis. Her son died 12 years before she did. But throughout her life, Alice remained the eternal optimist. In her own words:
“I look at the good. When you are relaxed, your body is always relaxed. When you are pessimistic, your body behaves in an unnatural way. It is up to us whether we look at the good or the bad.”
No matter how bad the conditions, no matter what the obstacles, there will always be winners as well as losers. And if you look carefully you will usually find the winners are optimists, and most of the losers tend to be pessimists.
Which do you choose to be – optimist or pessimist, winner or loser? Will you look for the opportunities that are out there to grow your business and help your clients achieve their objectives, or will you simply react in despair and join the many advisers whose businesses are going on a one way journey downhill. The choice is entirely yours. I know what choice I have made!