In defence of BACK2Y-ers (and why you can’t trust Financial Journalists).

“Journalism: A profession whose business is to explain to others

what it personally does not understand.”

Lord Northcliffe

Imagine the situation. You’ve been sent to Poland by your Employer, to a Convention on Polish Architecture in the 17th Century. You don’t speak Polish, you don’t like Poland and you have no interest in architecture. But you have to go. And you must try and decipher or spin at least one nugget of information gleaned in order to justify your existence to your Employer.

That’s how Laura Miller of Professional Adviser must have felt when she attended the BACK2Y Financial Planning Conference a few weeks ago. Granted she was well outside her comfort zone (which is Zone 3, according to her twitter bio @CitizenLaura). And she did have to spend a night in a hotel, in Birmingham, of all places.

I’m guessing she was having a bad day. Why on earth did I invite her?

It all started a year ago, on 12th February 2014 to be exact, when I met up with her boss, Scott Sinclair at Professional Adviser for a coffee. He told me that he would really like to get behind proper Financial Planning, even though he openly confessed to being extremely frustrated by having his hands tied by his paymasters – being the product provider advertisers – in particular Scottish Widows, who were constantly demanding more and more product pushing coverage in return for their big bucks advertising spend.

What inspired me about Scott was that it seemed like he really got the message about the pressing need for Advisers – in a fee-only world – to create a service proposition that focused on the client more than financial products. With this in mind I invited him along to BACK2Y: The first, ever, independent Financial Planning Conference NOT funded by product providers or investment houses: A Conference focused on getting Advisers ‘Back to Why’ they do the job – i.e. to take care of clients and to help them get and keep the life they want.

Unfortunately, Scott couldn’t make it. So he sent Laura.

This year Laura asked if she could have an exclusive. She wanted to be the only journalist in the room.

I made a mistake. I said yes.

This resulted in two articles written by Laura, who appears to have a personal vendetta against myself, Alan Smith and other speakers, not to mention the delegates (whom she refers to as the ‘BACK2Y-ers’) – who, unlike Laura, had paid to be there.

She suggests a ‘cult’ and she intimates that she knows WHAT and HOW ‘they’ (the ‘BACK2Y-ers’) think. She has no idea.

Her articles are extremely bad examples of professional journalism.

She had to wait until the last speaker of the day to find her ‘angle’ for this article. The last speaker was Sean Weafer, who is not a Financial Adviser (and therefore not a ‘BACK2Y-er’). Sean is a professional Business Coach and his talk was about the High Trust Adviser. He said that “the age of selling is dead; this is the age of the High Trust Adviser – where the focus is on creating engaging advice-based trusting client relationships rather than the sale of products”.

What Financial Planners are selling is a PROFESSIONAL SERVICE which has to be ‘sold’ because most clients are unfamiliar with the ‘new methodology’. Another word for sell is ‘promote’ and yes, speakers were promoting their methodology elicited through personal experiences – or as she calls it ‘storytelling’.

For some reason Laura states that all BACK2Y-ers believe that selling is bad. She states that ‘not selling’ is the backbone of the ‘BACK2Y movement’. Not true.

It seems to me that Laura Miller doesn’t much like Financial Advisers – and it is her who believes that selling is bad. “Ergo, selling and sales are bad” Laura Miller, 20th March 2015.

I didn’t know that there was a ‘movement’ as such, but perhaps there is now, so let me correct Laura on behalf of the ‘movement’. The backbone of the ‘movement’ is that the time has come for Financial Advisers to break the ‘shackles’ of the ‘Industry’, to stop being pawns in the game of product providers and investment houses and instead create, communicate and deliver a service that does not revolve around the sale, distribution, switching, rebalancing or churning of a financial product. Advisers need to realise that they are no longer paid by product providers to market / distribute their financial products and investments and are instead paid by a client to deliver a professional service that makes their life better, not makes the ‘Industry’ richer. BACK2Y is an event put on by Advisers for Advisers and exists to create a platform for Advisers to help and inspire other Advisers to succeed in a new world – a fee-only world – not by peddling products, but instead serving their clients.

Those Advisers in the room, nearly 350, turned up at their own expense, and are all on various stages of the journey. These Advisers (the brainwashed cult, according to Laura) are actually free thinking professional Advisers who have come to the same conclusion – that things must change.

Laura makes no mention of the general buzz for the day – i.e. that it’s all about the client, not their money – or the fact that it was NOT sponsored; that several MMU University students were invited free of charge (and have probably found jobs) and that well known and highly respected figures from the Financial Planning profession were present. Delegates included some of the UK’s leading financial planners, including several CFP examiners, also present were Nick Cann & Steve Gazzard from the IFP – and also the next President of the PFS, Sharon Sutton. They paid to be there. All clearly brainwashed and part of the ‘cult’?

Personally, I committed nearly £70,000 of my own money to put on this year’s BACK2Y. I had no guarantees. I had to just hope that other Advisers felt the same way as I did; that I wasn’t the only one who had become tired of Conferences dominated by product provider ‘sponsors’, free golf balls, free cuddly toys and boring investment manager fund pitches. I’m not the only one who has become tired of the Financial Porn – and it’s wrap around advertising covers and increasingly loud banner ads – which exists purely to keep Advisers attention on products and investments in order to keep flogging advertising space – and keep paying Laura’s wages.

So, with no advertising budget, 350 folk turned up. Almost twice the numbers of the first year. Simply by word of mouth. Advisers telling other Advisers. And yes, I did have to ‘sell’ them tickets to help recover the cost. Sorry about that.

None of the good intentions of the event were mentioned by Laura.

Instead she chose to ‘slag off’ the event, completely ignoring its good intentions and instead fill her article with inaccurate references – and irrelevant and misguided quotations from books (without citing the author – which is bad practice) or worse, quoting other speakers who were not even present.

Her use of the words ‘financial Disneyland’ is very derogatory to Financial Planning. As are numerous references throughout her article. Her continuous reference to ‘storytelling’ suggests myths or fibs. Her continued use of the word ‘cult’ is also derogatory.

She completely misunderstood and misquoted Alan Smith when he stated “There’s only so much that clients will pay for transaction based advice, but there is no limit to what they will pay for changing their life”. She twisted this into a cheap and nasty dig that suggested that clients were being ripped off for lifestyle financial planning, when it’s quite the opposite. Lifestyle Financial Planning done well delivers genuine benefits and demonstratable value. Advisers charging 1%pa and NOT doing proper financial planning are more likely to be the one’s who are fleecing clients.

She also failed to report accurately on Alan’s wise suggestion to delegates of considering moving to fixed fees and his explanation using the ‘Dragons Den Test’:

Bannatyne: “So, let’s get this right, you make a 20-25% margin?”

Investment Focused ‘New Model’ Adviser: “Yes”

Bannatyne: “And your income revolves around the one thing you can’t control?”

Investment Focused ‘New Model’ Adviser: “Yes”

Bannatyne: “So, if markets fall by 40% your income goes down by 40%? Just when you’ll need to work harder than ever to keep clients from leaving?”

Investment Focused ‘New Model’ Adviser: “Yes”

Bannatyne: “I’m out!”

An increasing number of BACK2Y delegates are charging their clients fixed fees for a service that does not necessarily depend on the levels of assets under management.

For example, she made no reference to the fact that 64 advisers had travelled from the Netherlands to attend BACK2Y. These Dutch Advisers can only charge their clients directly – i.e. from their personal bank accounts. That’s why they support and benefit from the BACK2Y ‘message’.

Closer to home, she made no reference to Steve Martin’s talk about advising Business Owners and charging for a comprehensive financial planning service that did not depend on the value of invested assets.

She obviously did not pay attention to Chartered and Certified Financial Planner, Ruth Sturkey’s inspiring talk about digging deeper with clients to uncover what they really want most – which is not financial products. She made no reference to Chris Budd’s talk on ‘Advising versus Coaching’.

I could go on.

What saddens me about this is that, because Laura wanted an ‘exclusive’, I honoured that. I even turned down the suggestion from Steve Gazzard at the IFP to invite Kevin O’Donnell, editor of Financial Planner magazine – because I had already promised Laura she would have her ‘exclusive’.

Well, we all make mistakes.

To sum up, BACK2Y was an incredible success. The survey results say so. And hundreds of great suggestions have been put forward by delegates to make sure next year’s event is even better. And, subject to our budget, we’ll do what we can to accommodate these suggestions.

All I’d say is, if you don’t GET it, if you don’t see why things have to change, please don’t come to BACK2Y.

Finally, to quote Stephen Fry:

“Many people would no more think of entering journalism, than the sewage business – which at least does us all some good.”

#BACK2Y