An independent (financial adviser’s) view

Very exciting, back from holiday (great, thanks, and a whole week, longest break since pre-you-know-what), and new car arriving! Which led me to muse how we make the biggest decisions in life, financial and otherwise, on instinct rather than research. Cars after a brief test drive, homes within seconds of walking through the door and partners/spouses/employees within minutes of first meeting. And yet we’ll agonise over?the price of a tin of tuna or whether to buy an extra bag from the Coop for 15p. Anyway, bank holiday traffic, both human and motorised, was murder in Burford following the opening of J Clarkson’s pub, now known locally as The Farmer’s . Just to annoy him, my car is both German and electric. Sorry, Jeremy.

“FCA to launch protection commissions probe over competition concerns”

How could a review into the evils of commission paid to those who sell life insurance be a bad thing? Isn’t most of it a rip-off anyway? Well, I guess you have to hope that it is – it will either be a waste of money or the best thing you ever did, and you hope it will be the former. The stats are that only 35% of the population have any form of live cover, about a third of those who do get it via their employer and that in 2023 the number of policies taken out fell to it’s lowest ever level. There were once hordes (100,000 or more) of men from the Pru, Allied Dunbar et al knocking on doors (often literally), asking awkward questions (‘back up the hearse and let them smell the flowers’ was the sales-training mantra) and persuading the often-unwilling to sign on the dotted. Those that still do, and the comparison websites which provide the diy option, will be still less inclined if the financial incentives are reduced. And many who need it (which is most of us at some time) will end up without life insurance.

“Starmer warns Labour’s first budget will be ‘painful’”

‘Like a family solicitor sitting you down to tell you that, sorry, I know you thought you could pay the mortgage off but your mother has actually left everything to the cats’ home’, is the best description I’ve heard of the Starmer Rose Garden Speech this week. Basic message, things are far more terrible than we thought, those with broadest shoulders etc. The question, of course, is how broad or weedy will your shoulders need to be before they’re loaded up, presumably with more tax? And what sort of more tax? It’s been said that the 30th October Budget will be the most significant for years; and can’t you just see those Halloween next-day headlines, with a photo of Rachel in a witch’s hat or Kier as Dumbledore? My world-weary message remains the same, though. If you try to pre-empt, you’re as likely to lose as to win. So unless you have a yacht on which to sail away, grin and bear (or, who knows, celebrate) with the rest of us.

“Firms with over 50 advisers report pre-tax loss in 2023”

For those of us who have been in the business for a while (OK, quite a while), this comes as no surprise. The oft-disproven but still-recurring theory is that bigger is better, ‘consolidation’, buying ever-more firms of advisers and their clients will lead to economies of scale, make life easier for those advisers who don’t want to be bothered with anything but seeing and looking after their clients and everyone will be happier. And, for the regulator, surely regulating fewer firms will simplify their job? Unfortunately, it’s the clients who come at the bottom of that pecking order, and as costs seemingly invevitably increase rather than decrease, their lot worsens, personal service (which most value most) goes out of the proverbial window and the bad apples hoping to get lost in the crowd bring the rest of the crowd into disrepute. And so it goes round and will do again. Small really can be beautiful.

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“Financial wellbeing: Does more money make us more happy?”

Well, a rather more existential than the norm question for a financial services trade mag. Does money make you happy? Does more money make you happier? In our profession we may, I guess, be in a better position than many to judge although, over the years, we tend to meet more of those with than without. It’s also a judgment which is easier to make with the boring qualities of age and experience, so here’s my not-so-existential take on it. If you don’t have enough to do the basics, having more will of course make you happier. The next step up is, in my parlance, not having to worry or think about money, enough in the bank to go out or go on hols when you want and a back-up invested (with us). Then there’s having loads, because you sold a company or inherited a pile. Many or most of those have itchy feet and worry more than those in Group 1, I’d say. Nice problem to have? Maybe; but there’s a whole book to be written here.

It’s a book and a film (‘Give us a Clue will immediately come to mind to those of a certain age, kids etc.) and I came by recommendation, first to the documentary, recently in cinemas. It tells the story, or a good part of it, of Charles Burrell (actually Sir Charles) and his wife, the entirely appropriately-named author of the book, Isabella Tree. After many years of trying to make the family farm (the Knepp Estate in Sussex) at least break even, they took the radical decision to embrace 'rewilding’, some 25 years ago, well before it became a thing. And what was involved was indeed quite a thing. It was the work of many years to undo the harm (a still-debated description) wrought on the land by the years of intensive farming since all had to dig for victory in the war. They reintroduced wild cattle, boar and deer, took down the fences and hedges, sowed wild stuff and let nature get on with it; with extraordinary results. Ancient oaks revived (who knew that, left to it, they communicate with other oaks via underground micro-tentacles?), and when the land was infested with thistles, clouds of butterflies arrived, whose caterpillars cleared them. It’s a beautiful film and looks gorgeous. The book fills in many of the how to/how-on-earth? and other factual stuff, and I found it equally fascinating if a tad dry in places. Many practical questions remain, of course. If everyone did it, how would we be fed, and wouldn’t we be transferring the nasties to other, poorer countries. And could farmers without a castle and baronetcy ever afford to do the same, without yet more massive subsidies? It will make you think, however. In my case, a lot.