Financial Planner Magazine - Paraplanning 
Added : 9th October 2007
Paraplanning now plays a pivotal role in the modern financial planners practice but there are still advisers who are not sure what a paraplanner: is, does or should do. Because of this, many paraplanners are not used to their full potential and even worse, some are still merely used as administrators. Advisers are still unsure how to make the most of their paraplanning resource and the benefits a good paraplanner can bring to their business.
Advisers have always had assistants, however, as their businesses changed, the role of these assistants became more defined and developed into that of a paraplanner.
The paraplanner forms the bridge for an adviser between conducting the meetings with the client and getting the business issued. The paraplanner coordinates all the administration required, designs an appropriate solution in conjunction with the adviser, prepares all reports and post sale documentation and provides technical advice when required. The Paraplanner however is not an administrator and it is important to differentiate between to two roles. Administration requires a different set of skills to that of Paraplanning in the same way that Advising requires different skills.
Paraplanning has now developed to a point where I believe it should be separated into 3 distinct ‘levels’. The ‘levels’ would be Support Paraplanner, Paraplanner and Senior Paraplanner. A paraplanners level would be dependant upon their skills, knowledge and experience and this would provide businesses with some clarity when determining what type of paraplanner they actually need.
In order to be successful as a paraplanner any individual needs to possess some basic skills such as the ability to write reports; to analyse statistics; to research appropriate products and funds; have a good understanding of compliance issues; to organize their own and their advisers time and prioritise. They must also have excellent IT skills and interpersonal skills.
The knowledge and experience however is likely to be commensurate with the level of paraplanner mentioned earlier and I would suggest the following:
- Support Paraplanner – 1 – 2 years experience, Certificate in Financial Planning
- Paraplanner – 3 – 5 years experience, some Diploma level Qualifications
- Senior Paraplanner – 5 years + experience, Full Diploma / Advanced Diploma / CFP
Structuring the role like this provides much greater clarity for both the paraplanner and the business and also provides a clearly defined career path. It is important to recognise the difference between the roles of each ‘level’ and to allocate tasks accordingly.
It is important to present to any client a team rather than a single adviser. The team approach ensures that the client always has someone to answer any immediate concerns. It would therefore not be unusual for a team, as happens at Cooper Parry, to comprise an Adviser, Senior Paraplanner, Support Paraplanner and Administrator. All have clearly defined roles and tasks within the advice process. The Senior Paraplanner is likely to be as qualified, if not more so than the adviser they work with to allow adequate case discussion and provide knowledgeable technical support.
For an adviser, the more experienced and knowledgeable your paraplanner, the greater the support they will be able to give you and your client, which, in turn will allow you to a) spend more time with your clients and b) provide them with a much more professional experience.
Paraplanners should be encouraged to develop, to learn new skills, to meet fund managers, to read the financial press. Any truly 'independent’ financial planner who strives to offer their clients the best possible solution from across the whole industry, requires knowledge of that industry. Unfortunately, even the best financial planner cannot know everything and the procurement of knowledge should be shared across the team.
Paraplanners also require intellectual stimulation and support from other Paraplanners, much like advisers require stimulation from other advisers. My experience has told me that it is much more difficult for a Paraplanner to offer excellent support without access to the support of other paraplanners. It is important to allow paraplanners to meet with other paraplanners, to share ideas, to discuss problems and for these meetings to be a worthwhile, shared experience.
In addition Paraplanners and their skills and technical expertise should be valued much more greatly by the industry in general.
When there are round table discussions, or conferences how many paraplanners are invited to attend? Paraplanner’s technical knowledge may be greater than an adviser’s, their experience of dealing with third parties is likely to be greater and they still have client facing experience. Surely paraplanners would be able to offer as great an insight as advisers?
Similarly there are a number of paraplanners like myself, who have worked hard to achieve CFP and yet we are not recognized by the IFP. Only registered individuals can be listed on the website! From a clients perspective surely it would be advantageous to know that not only their adviser but also members of the adviser’s team have professional qualifications? Perhaps a list of companies who can provide a CFP (with a distinction for those who are authorized) would help a client make a more informed choice?
Paraplanning is a career in its own right, it should be valued as such and Paraplanners should be held in much higher esteem within individual business and the industry in general.
A small number of businesses, like Cooper Parry, do recognize the benefit a good paraplanner can bring to the business, however there are still some that don’t and it is important for the industry as a whole, that the role of the Paraplanner is valued much more highly than at present and that Paraplanners are recognized for the enormous benefits they can bring the individual businesses and the profession in general.
Martin Vaughan
Senior Paraplanner
Cooper Parry Financial Planning
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