The increased importance of financial planningIt’s a year where a lot has changed, including financial plans: retirement aspirations have been turned upside down; rainy day funds used up; parents have helped their furloughed or unemployed children; and, possibly, earlier than usual gifting has taken place. During such uncertain times, financial planning has become even more pivotal. It’s therefore no surprise that over a third of investors say that the Covid-19 crisis has prompted them to value the benefits of financial advice more1.
So with tax year end soon approaching, here are some ideas on how you can take advantage of this clear desire for expert advice, to maximise the opportunities for you and your clients.
Embrace technology this tax year endWith many advisers now making greater use of technology, virtual client reviews are a good way to talk about potentially new circumstances and adjust client goals accordingly. However, additional features on video conferencing tools - such as the Whiteboard functionality on Zoom - are great methods to explain complex concepts. Using Gallery or Speaker view to engage other family members is another way to get more from the meeting. To make your life even easier, there are also various marketing agencies who can personalise client guides to Zoom for your firm.
Effectively target your clients with an email campaignA targeted email campaign could also be extremely effective for your overall marketing strategy. At the click of a button, clients can be easily alerted to make the most of their annual allowances and a review meeting arranged. Remember, though, it is important to set a goal for the campaign: then, segment clients based on this goal, devise the appropriate content and execute accordingly.
For example, if the goal is to engage with 40% of your client base for tax year end planning, they could be segmented according to unused annual allowances and whether there are any cross-sell opportunities. Perhaps prospective clients could be approached, too. Email templates can be crafted, though some financial providers offer these through their own tax year end activity. The subject line should reflect accurately the content of the email. This will help build trust with your client base and increase open rates in the future. Finally, send these emails in good time ahead of tax year end and ensure that those clients who should be seeing you are followed up with a call – this is key to building engagement.
Revisit both your client’s financial and wellbeing circumstancesThe pandemic has proven to be a stark reminder of the importance of health. As a result, it’s now more than ever a subject at the forefront of clients’ minds. So, as they think about reviewing their financial plans for the coming tax year, now is an opportune time to review their approach to wellbeing, too. At VitalityInvest, we believe that it’s not just about financial security in retirement, it’s about having the good health to enjoy it as well. Incorporating health into retirement planning -whether during the fact-finding process, cash flow modelling or when it comes to making decisions about drawing down - are key ways of differentiating your offering from other advice firms.
Don’t forget the basicsTo start making the most of the tax opportunities available to clients at this time of the year remember to:
- Maximise ISA (£20,000) and JISA (£9,000) annual allowances, and check whether your client’s spouse or partner has maximised their ISA to fully utilise the combined allowance of £40,000.
- Contribute as much as possible to pensions and carry forward any unused pension allowance from the previous three years. Grandparents can also contribute into their grandchild’s SIPP each year too providing the child with additional tax relief.
- Gift up to £3,000 IHT free and make use of any unused gifting allowances from the previous year.
- Make charitable donations – these may be under the gift aid scheme.
- Utilise the CGT exemption of £12,300 to capture gains.
Think beyond the current tax yearTax year end is often the busiest time of year for financial advisers, but 2020 showed that life is very unpredictable, and that financial planning is an all year event. Given the uncertainty that last year showed, it’s never too early to plan and stress test financial plans for multiple ‘what-if’ scenarios.
The effects of spending, inflation, longevity and risk/return are common factors considered in cash flow modelling, but factors such as furlough, moving to a new home or changes in lifestyle, as well as changing business plans and individual health metrics may not be. Now is the time to think about what the future of financial planning could look like, and how these changes can help maximise your business.
How VitalityInvest can helpTo help you make the most out of financial planning opportunities this tax year end, we’ve developed a dedicated hub containing helpful resources, ready-made client email templates, online tools and more.
At VitalityInvest, we believe that successful long-term financial planning should encompass both financial and physical wellbeing. So we offer a range of discounts and behavioural nudges to incentivise clients to invest for longer and look after their health. This means that when your clients take steps to be healthy and invest in Vitality funds, they could enjoy zero product charges across their whole plan. Our cashflow planning tools also help you personalise your clients’ plans to reflect their wellness and longevity.
1. Columbia Threadneedle survey, May 2020
VitalityInvest is a trading name of Vitality Corporate Services Limited. Vitality Corporate Services Limited is authorised and regulated by the Financial Conduct Authority.
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