Why it pays to use a small independent financial advisor firm

Why It Pays to Use a Small Independent IFA Firm.

We’re not talking about ‘one-man-and-a-dog’ micro-firms run by people who are playing at it.   Our firm West Riding is a ‘small firm’ in the regulator’s language, but we’ve been going since 2004 and we now manage well in excess of ￡60m for clients UK-wide. Even so, we remain family-owned and we aren’t part of any so-called ‘networks’ or larger groups. Our clients benefit from this approach, as we’ll explain.

We are Completely Independent and Work Only for You

We are not a 'distribution channel' selling products for banks, insurance companies and fund management houses. We are and will remain Independent. Many larger firms, banks, building societies and network members offer only ‘restricted’ advice. For many firms, this means that their advisers are told what they can and can't offer clients. That usually means their clients are directed only to their own funds, or to a limited range from companies with whom they have 'sweetheart' deals. We, being independent, select funds and products from the entire market, and we don’t ‘sell’ at all; we advise.

No External Shareholders

In large companies, external non-family shareholders who aren’t involved in the day-to-day running of the business only see senior managers and don’t deal with clients at all. They aren’t interested in staff or clients, other than as generators of profit, so, they pressure managers to cut staff costs and increase client fees. We work alongside our staff and have close relationships with our clients, for whom we are always looking for ways to give more value.  

No Fat

The more managers a firm has the more layers of red tape. Most of us would probably like to be a bit slimmer, but at least our firm doesn’t have a bloated and expensive management structure. Likewise, we don’t waste money on glass-walled offices in city-centre locations or pointless fripperies like fancy leather-look wallets for paperwork. Our original business plan stated ‘Expensive showy ground-floor shop-front type space is not envisaged.’ We’ve stuck to that. Keeping overheads down enables us to keep our fees low. For the same reason, we aim to minimise bureaucracy and maximise common sense. All our staff help us keep the firm lean and are encouraged to voice their opinions. Most importantly we set out to employ trustworthy people who can self-manage. So, we invest in people, train them properly and treat them fairly. In return, we have high expectations. Poor workers can easily fly below the radar in large organisations but in a small firm, there’s no place to hide. Ours is a close-knit team, so anyone who didn’t pull their weight would stick out like a sore thumb. Conversely, whereas staff who go above and beyond can often be unappreciated in a large firm, we notice hard workers and reward them accordingly. We aim to recruit the best possible staff in the first place, look after them well, reward them on the generous side of fairly, and keep them long-term. That’s a key component of our entire strategy because longer-serving staff members acquire a deeper understanding of our clients’ circumstances. 

The Buck Stops Here

We are not the slightest bit interested in being a large firm. We shall always be a small firm, by design, not by accident. That way we keep it personal, we contain costs and we still earn a fair living. What we’re about is giving customers the best personal service we can possibly give them, at a hyper-competitive price, whilst ensuring the staff are well trained and fairly paid for what they do. We’re in business to make a living, not a killing, and in a profession that is still teeming with salesmen masquerading as advisers, we are driven by research and knowledge, a true adviser firm, not a sales outfit. 

As the owner, I could not imagine West Riding being anything but Independent. I set it up so I could be my own boss and offer a truly independent service to clients. And it really is a service that’s as personal as ‘personal’ gets. We don’t hide from our clients. During office hours we answer every telephone call within three rings and I am available 24/7 to all our clients. I’m in the Leeds phone book and all clients have my home and mobile numbers. Why does this matter? Well, one client contacted us out of hours for advice on an investment she was contemplating in the so-called ‘Mini-bonds’ offered by London Capital & Finances – LCF. We got back to her straight away, warned her off and saved her ￡60,000. It’s all been reported in the media. The links are on the front page of our website - https://www.wrpfs.com/. 

Probably the greatest endorsement of small family financial advice businesses was that given by Harry Markopolos, the American former securities industry executive who blew the whistle on Bernie Madoff. In an interview that can be found on YouTube, Mr Markopolos stated that he would only ever use a small family adviser firm. Watch both parts, and around the 20-minute mark in part 2 you'll hear his advice to use small family firms like ours. https://www.youtube.com/watch?v=cfwJ06hc0_8.

Small Independent Financial Adviser businesses like ours work well for clients because they are well-run by owner-managers whose lives are in the business. We know and freely accept that at the end of the day, the buck stops with us.  

Neil F Liversidge, Founder and Managing Director