Financial planning and investment advice
We explain our services separately for ease of understanding, but in reality all our clients receive Financial Planning and Investment Advice. It’s the core of what we do. It would be reckless to invest without a plan, and most plans require some sort of investment, which is why everyone gets both!
We also offer services tailored to people getting divorced, ranging from helping design and negotiate financial settlements, to being instructed as a ‘shadow expert’ for complex pension sharing cases. Very few financial advisers can truly match our commitment, credentials and experience in this space.
Our approach to financial planning
Plan first
We use an objectives-based approach to financial planning, one that begins with the end in mind and focuses on your unique wants and needs.
When we talk about objectives, we don’t mean vague phrases like ‘grow your wealth’, instead, we aim to be very specific and guide you towards objectives like:
“I want to partially retire in 4 years with 50% of my current income being replaced by my pension and investment portfolio. After 2 years of working part-time, I want to fully retire with 50% of my expenditure funded from guaranteed sources and the remaining 50% funded from flexible withdrawals. I also want to take a one-off withdrawal to help with my children’s wedding costs and pay for a three-week luxury holiday.”
We will help you to identify and prioritise your financial objectives, and then we will devise a strategic plan to achieve those objectives.
The plan will be guided by our own financial software, which allows us to project your future financial life and run comprehensive ‘stress tests’ to analyse the likelihood of you being able to achieve your objectives without running out of money.
Advice second
It is only after we have the plan in place (i.e., we know how and when you expect to spend your money) that we will start advising you on specific financial matters such as which pensions to choose, how best to invest for your goals, and what other financial ‘products’ you need.
We will recommend the best available investment platforms, tax wrappers, funds and policies to service your plan, and because we are fully independent, you do not need to worry about potential conflicts of interest arising from us trying to sell you our own products. We don’t have any to sell!
…Simply put: we help our clients build a strategic financial plan that will help them to live and fund the lifestyle they want, and then we advise them on how best to implement and manage the plan.
Our approach to investment advice
Setting the framework
Investment Policy Statements (IPSs) are used to codify an investment strategy and provide an objective framework for assessing the decisions that are made.
IPSs are mostly used by trustees of either family or charity investments, however, we believe that every private investor should have an IPS,. Because of this, we have designed a template IPS that we complete with all our clients and review annually against the performance of their investments.
Our IPS sets out important aspects of the investment plan, such as the:
Risk level.
Strategic asset allocation.
Contribution or withdrawal strategy.
Investment style.
Rebalancing strategy.
Performance benchmark.
Approach to drawdowns.
Guiding principles
The following points summarise our core investment principles:
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You should only ever invest as part of a plan, and with the right plan in place, choosing the right investments becomes easy.
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This means how much you invest in different things, like equities (stocks), fixed income (bonds), and cash.
Different asset classes behave differently, with varying expected rates of return and levels of volatility. This means they should be carefully selected (as part of your plan) for different purposes.
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The less you pay, the more you keep.
It may not seem like much, but if we can save you 0.5% on your ongoing fees and give you the same expected return, your portfolio will likely be tens (if not hundreds) of thousands of pounds better off over the long-term.
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Having good ideas is one thing, putting them into practice is totally different.
When to buy and sell different funds (i.e., rebalance your portfolio) is very important and a lot of investors struggle with this, often 'tinkering' too much which creates unnecessary fees.
A combination of tolerance-based rebalancing for our portfolios and not slavishly following an index for our multi-asset fund solutions gives us a distinct edge.
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No-one can consistently (and indefinitely) outperform the market by selling when prices are high and buying when they are low.
Investment returns are (mostly) unpredictable and investors lose more money by sitting on the sidelines than they do by investing through the good times and the bad.
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We prefer formulaic, data-led strategies that do not rely heavily on people making decisions.
This is because there is simply too much information available in market prices for any human to analyse all the relevant data, form a decision, and act upon said decision before the information changes.
For context, the equity universe contains around 15,000 companies. No investor/fund manager could possibly know and understand all those businesses, let alone their balance sheets and financial ratios.
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We have over 100 years' worth of data available to analyse, supported by a wealth of academic literature and economic theory to inform our investment decisions.
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Market prices are incredibly information rich. They represent the collective wisdom of all market participants (buyers and sellers) and data shows very few can beat the market consistently.
The majority of investors that attempt to outperform the market fail, which means investors that base their approach on market prices typically do better over the long-run.
Implementing great ideas
Investment management is a discipline that is distinct from financial planning. Done properly, it is a full-time job that requires access to a monumental amount of data, the skills and tools to analyse said data, and the time to make decisions based on the results of that analysis.
We provide over-arching investment advice to our clients through the setting of the Investment Policy Statement, but we prefer to outsource the day-to-day management of our clients’ investment portfolios to a very carefully selected group of third-party discretionary fund managers (DFMs) whose investment principles align with our own. Doing this helps us focus on what we do best, and ensures our clients receive exceptional portfolio management services at very competitive rates (often cheaper than doing it ourselves).
The following two videos provide an introduction to our two preferred DFMs, Dimensional Fund Advisers, and ebi Portfolios.
Meet our investment partners
Dimensional Fund Advisers
Ebi Portfolios
