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Adviser Spotlight – Julie Lord and Gretchen Betts, Magenta Financial Planning

  • By Sue Whitbread

In this popular monthly feature, IFA Magazine talks to leading advisers about what’s working well in their financial planning businesses. This month we’re off to Wales, as Sue Whitbread talks to Julie Lord and Gretchen Betts following the launch of their brand new financial planning business, Magenta Financial Planning, in 2016.  

  1. Magenta Financial Planning is a very new business – what was it that made you decide to set it up in the first instance?

Julie: As you know Sue, I ran Cavendish Financial Management in Cardiff for 17 years, before selling the business to AXA. After various mergers and acquisitions, I found myself working for a large investment based company which did not suit me (or indeed my clients!) However, I still really love working with people to help make their dreams come true. That’s why I set up Magenta, as a new company where I could continue to look after most of my original Cavendish clients (who were very happy to follow) and employ all the old values to ensure that the clients receive a really valuable service. It’s great that we can help them to feel secure and happy and help them to make the most of their lives.

Gretchen:  I’d been working alongside Julie for the last 3 ½ years and had lost faith in the service I could provide to my clients as part of a large wealth management company. They were changing their approach to using cashflow planning (i.e. not using it!), and this opportunity, to work with Julie again and to be part of creating something new, was something I had to grasp with both hands.

  1. What was your experience of setting up Magenta as a new FCA registered and authorised business? Were there lots of ups and downs?

Gretchen: Our first challenge was choosing a name for the business. We felt it should be one that people could remember and pronounce easily and that also had some meaning. After much debate we settled on Magenta. This was because colour psychology suggests that it represents the colour of cheerfulness, happiness and contentment and most people feel more optimistic in the company of magenta.  Also, the colour is meant to push you to take responsibility for creating your own path in life. This felt like it suited us, as well as reflecting the service we wanted to provide in our business.

The FCA application process was onerous and very detailed. We used a third party compliance consultant to support us in this and doing so was very valuable.  For any others going down this route, my tips would be:

  • be very methodical in your preparation
  • work hard on producing a very strong business plan with back up financials
  • be true and honest about what you really want your business to be
  • Establish who your bankers and accountants will be early on in the process and ensure that they understand the timeframe and deadlines you will face in the application process.
  • Get a PI quotation well in advance
  • Plan in detail your capital adequacy requirements, based on your forecast figures

We double and triple checked our application – and even then we received some further questions from the FCA. Overall, it took about a month and a half to prepare the application and then 4 months for the FCA to approve it (by their timescales this is actually very good apparently!).

Of course we have had our ups and downs and in the early ‘settling in’ months this happened quite often. However, the joy of working in a small business is you can make decisions to change things quickly if necessary and can surround yourself with a group of people who you can rely on to support you through those ups and downs.

Julie: Anyone who knows me will appreciate that I am a “big picture girl” so I wisely left all the nitty gritty stuff to Gretchen who is great on detail and implementation. We make a very good team! On balance there were no big problems – we were buoyed by the excitement of starting our new business and remained positive at all times.

  1. Julie, you’ve been a leading light in the UK financial planning profession for many years now. Can you give us a potted history of your career prior to setting up Magenta? Are there particular things that you have learned from experience which you wanted to do differently at Magenta? What is it that keeps you inspired and motivated year in year out to keep working with clients and running a financial planning business?

I set up Cavendish Financial Management in 1991. We were one of the first fee based financial planning companies in Wales and I was the first Certified Financial Planner.  Right from the outset I wanted to provide advice and guidance to help clients achieve their desired future lifestyles rather than just sell them financial products. I wanted to change to a professional services model to align better with clients; build a stronger business and get away from a commission/sales bias.

The business was transformed when we discovered Prestwood financial planning software and were able to model future scenarios for clients. This became (and still is) the most valued part of our service and it enables clients to make properly informed decisions about their future lives.

As you say Sue, I’ve been around for a while! Readers will see from my biography that I’ve been committed not only to my own professional development as a financial planner but  also to do my bit for the development of the UK financial planning profession in various ways.

In 2006 I set up a synergy group with other like-minded planners in other businesses to promote best practice and to deliver cost savings and great new business ideas.

This made us very attractive to AXA who purchased Cavendish in 2007. The same Cavendish philosophy and  service became a cornerstone of the Bluefin Personal Consulting service, employing the same small company ethos, processes and principles within the larger business. This business was sold to Towry in 2013.

I left Towry in July 2015 with a view to setting up another smaller business to provide bespoke financial planning services, rather than just investment management. While waiting for authorisation for the new firm, I worked with Keri Carter at Broadway Financial Planning, one of the original synergy group members.

In 2015 I became a Director of Prestwood Software and am committed to helping other financial planners to improve their client offerings by including cashflow modelling and comprehensive lifestyle advice.

Experience tells me that the bespoke, comprehensive lifestyle planning service that we provided at Cavendish is still what clients really value. It is also a fun and profitable way forward for a business and cannot effectively be delivered by large companies. Magenta has adopted this philosophy and I continue to be rewarded and inspired by the sheer joy of seeing clients achieve their goals and dream lives as a consequence.

  1. What are the key principles on which the business is run?

Julie: Our main objective is to work together with clients to build plans for their future security and happiness. The clients must come first. We want every client’s experience to be a good one, giving them confidence from the start that we are there to support them. Value, transparency, challenge and great delivery are aspects that our clients love.

We have set the business up to be honest and open, engaging our staff in the Magenta brand and all within a happy, positive workplace environment.

We are also passionate that if we can save a tree or two by cutting down the length of reports / paperwork or by using technology to improve our communications, we will.

  1. How do you deliver the service to clients? What technology do you use? How is the business structured in terms of personnel and the roles you fulfil?

Gretchen : We believe that only by having a small team can we offer the level of service we strive to deliver. Our team consists of just four individuals. Each of us knows about every client and can readily assist whenever they contact us. Client feedback indicates to us that having a friendly, recognisable voice at the end of the phone is very important. For us, consistency is vital.

We use Prestwood Software for our back office system and cashflow modelling andTransact for the majority of our invested assets. We have a client secure document portal to exchange confidential documents and save on snail mail. We have also embraced social media in a big way.

As Managing Director, I run the business day to day, managing queries and personnel, as well as seeing clients. As Chief Executive, not only does Julie continue to see clients but she also uses her vast experience and excellent reputation in the profession to raise our profile, to network and generate new business opportunities.

We have an excellent back office team, who deal with all our administration and paraplanning needs and who fully engage with our ‘client first’ ethos.

  1. What is your approach to investment management?

Julie : We follow a passive / evidence-based approach to investing our clients’ portfolios. We don’t try to time the markets, stock pick or to beat the market and we don’t pretend to be investment specialists, so we outsource the investment management of our client’s portfolios.

All we aim to do is to obtain good returns, at the lowest possible cost and in line with our client’s attitude to risk. Most crucially, we do this with reference to their personal lifetime cashflow forecast, which helps us to see what returns are required by them in order to achieve their goals.

We have an investment committee that meets 6 monthly to assess the current strategy and any changes that may be required in relation to risk levels, our chosen providers and more specialist options, such as ethical investors or for specialist tax planning strategies.  

  1. Marketing is often something that financial planning firms find tricky. How are you promoting the business? What is working for you right now?

Gretchen:  Since launch we have been focusing mainly on our social media presence and on developing our website. It is vitally important that our online ‘story’ reflects our business values and how we want to be perceived externally. Sometimes it can feel like you are putting content out there and just not getting anything back, but if you don’t get involved with social media, you will certainly be left behind.

I manage all our social platforms via Hootsuite, which makes this manageable and posts can be scheduled in advance. This includes Facebook, Twitter, Linked In and Instagram. It’s still early days, but the message is starting to get out there and this is reflected in our SEO data.  Innovation is high on our agenda in 2017 and will be specifically looking to use more video or vlogs.

It is important to us that our messages show that we are approachable and friendly in the “people” side of the business and that we really show our personality as a brand. We have produced a series of videos about the team “get to know Magenta” and “client stories” (case studies). We have also used my cat, Basil, to add some humour and fun to some of our posts and videos. He is our Fluffy Motivator and we have included him on our website too. He is very popular on social media, with over 10,000 followers himself on Twitter, and we get quite a few people asking if they will get to meet him!  We have a way to go to get Magenta’s twitter feed up to this level, but we’re working on it.

In addition, we aim to update our blog with relevant technical information or human interest topics each week. Keeping this relevant and current is a high priority as this shows your website is up to date and current.  Our clients like our stories and regular email news about the Magenta team.

  1. Looking ahead, what is your vision for the future of the business?

Julie: We will continue to be small and beautiful! We have no plans to be much bigger, but want to work efficiently and give excellent service to our clients. Lifestyle financial planning will always be our focus – we just want our clients and our team to be happy.

  1. What would be your best tips for firms on what makes a great financial planning business?
  1. Love your job
  2. Take pride in your work
  3. Delegate the investment management and spend more time talking about peoples’ lives and not their money.
  4. Be less stuffy
  1. What do each of you enjoy doing outside work?

Julie: I play tenor saxophone in a local swing band. I keep fit by running, cycling and doing Pilates. I love dancing, skiing and golf (although haven’t played for a while!) and have recently taken up rally driving.

Gretchen: I’m a self-proclaimed cat lady and adoptive Mum to Basil the Persian cat, so I spend some time pampering him and tweeting! I also do a weekly tap dancing class and Ceramics night course. I have one nephew and I love getting to see him as often as possible.

Biographies
Julie Lord

Julie is a Chartered and Certified Financial Planner and Chief Executive of Magenta Financial Planning.  She was an Institute of Financial Planning Board member for 15 years and is a former IFP President.  She has been a member of the FSA Training Advisory Panel; Chairman of the IFP Education Committee and member of the ISO working party and is keen to ensure that all professional advisers are well qualified to deliver the best possible advice to the public.

As well as being a Chartered Fellow of the CISI, and a Fellow of the PFS, Julie has won numerous Financial Planning awards and is a regular writer and presenter of financial issues in the trade and consumer press.

She is very passionate about providing the best quality advice to clients and ensuring that financial planning businesses are embracing the best possible practices in order to deliver this service effectively and profitably.

Gretchen Betts

Gretchen is a Certified Financial Planner, Chartered Wealth Manager and Managing Director at Magenta. She began her career working with a Financial Planner within an accountancy practice, providing administration support and in 2006 started as an adviser herself. After studying and gaining her Diploma in Financial Planning in 2009, Gretchen has progressed to become a Certified Financial Planner and a Chartered Wealth Manager.  More recently, Gretchen worked for a large wealth management firm in Cardiff before starting Magenta Financial Planning last year. 

Gretchen is passionate about working closely with clients to understand what they really want from life and to create and implement a lifetime financial plan to help them achieve their dreams.  She is keen to embrace a modern approach to marketing and business and manages all of Magenta’s social media streams.