Size Does Matter When It Comes To Your Money

Who should you trust with your hard earned money?

There’s no getting away from the fact that in financial services we’re dominated by several big brands and UK-wide players. As is often the case in life, clients take comfort in familiarity bias.

With their infinite marketing budgets and glamorous city-centre offices, larger financial advice firms promise clients an unrivalled service.

But regular followers of this blog should hopefully by now understand that good financial planning isn’t about flashy, expensive products, or the overpromised investment returns that larger firms love to shout about. Instead, good financial planning is built on solid, meaningful, long-lasting relationships.

It’s a people industry, founded on trust. Because when all is said and done – you need to know, like and trust who you’re dealing with.

That’s true in almost all walks of life, but rarely more so than when it comes to an incredibly personal (and often emotive) subject such as your finances.

Sometimes bigger is better. But I’m a firm believer that when it comes to working out who to partner with in your financial planning, smaller wins out every day of the week.

This isn’t narcissistic self-promotion! On the contrary, there are hundreds of smaller financial planning firms out there that offer incredible services to their clients, many of whom I look up to personally in helping me shape my offering. And more and more smaller firms are coming to the fore which is fantastic to see!

So my advice to you is: if you’re currently working with a smaller planning firm and are close enough with your adviser that you could drop them a WhatsApp at any time AND they know you and your family inside outside… then you’re already onto a winner. Happy days.

But why is bigger not always better?!

Bigger doesn’t mean safer

The truth is that you don’t need a larger advice firm to offer your money the greatest chance of growth, nor does it offer you added safety and security with your money.

Financial services is one of, if not the most regulated industries in the UK. Put simply, the smaller firms out there have to adhere to the same rules and regulation that the bigger players do. Professional Indemnity Insurance is mandatory regardless of firm size. Smaller players have to be as diligent in their reporting requirements to the Financial Conduct Authority.

Financial planning firms are often described as ‘intermediaries’. What this means for you is that your financial planner simply helps you construct suitable financial plumbing (as I call it) to help realise your life goals and ambitions. The financial advice firm is held totally separate from your money. You’re paying for their expertise, experience and knowledge, not to handover your money to them. Put simply, they don’t have any access to your money, so the notion that bigger is safer is a totally moot point.

Bigger doesn’t translate to a better service

When you work with a smaller firm, you’re not just a number and you benefit from a unique experience that’s fully tailored to you and your family.

Smaller firms will get under the skin of your life far better than a larger outfit. The names of your grandchildren, where you went on your honeymoon, your family’s hobbies … the list goes on. Smaller firms are far better versed on your life and consequently are better placed to work out where your financial resources fit into it.

I’m not trying to purposely bash the bigger players out there, but if you’re working with a financial advice firm who are dealing with hundreds of clients then it’s far more likely you’ll be just a number and your value will be assessed by how much money you’ve got invested with them. You become a data point on a spreadsheet.

If you only hear from your financial planner once a year, then it’s reasonable to assume you’re just a number and you need to be looking for a new adviser.

My ultimate goal with my clients is for them to feel like they’re the only client(s) I deal with. That’s when I know I’m doing a good job.

As mentioned, it all comes down to trust; something that isn’t built over night. It can take several years for individuals to trust their financial planner with their deepest financial secrets and anxieties. This necessitates a lifelong client-adviser relationship.

Too often I’ve witnessed clients being passed between advisers, only for years of work to breakdown and start all over again.

Bigger means things are more likely to change

That’s another risk of dealing with larger firms. What happens if/when your trusted adviser moves on? Or if the financial planning firm gets purchased and swallowed by an even larger competitor? Consolidators don’t care about the small players out there.

Besides, in smaller firms it’s likely that your financial planner will be the owner of their business. It certainly is in my situation … and I’m not going anywhere.

The relationships I form with my clients today should last a lifetime and new clients should know they’ll only ever deal with me. I outsource other elements of my business (investment management, compliance, para-planning, administration) to free up my time to spend more of it in front of clients so I can truly get to know them.

I didn’t create Headsup with a view to selling. Instead it’s my business-baby. I’ll continue to shape and re-shape the business where I can, relying on feedback from my trusted clients, and using technology where possible to streamline operations, but I’ve no plans to take on an unmanageable bank of clients, nor recruit any other advisers. The simple reason is: no one else could be as passionate about the business – and my clients – as me.


Benjamin Mitchell

Benjamin Mitchell

I’m a chartered financial planner that can help you plan for tomorrow and also live for today.

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When it comes to money, we put your goals in life first. No jargon, no sceptical recommendations...
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