An adviser’s 5-point checklist for paraplanning cases

One of the questions we get asked very frequently when we take on a new adviser client is ‘what information do I need to give you?’

This is a tricky one. Every case is different and some require more information than others. My advice for presenting a case to a paraplanner – whether they’re outsourced or not – for completion is to:

1. Provide a note or email that summarises the main details of the case

This needs to be really succinct and clear to avoid misinterpretation and ensure you get everything you’re asking for. Bullet points are an ideal way of summarising a case request, and should always include confirmation of the following:

  • An introduction to the recommendations – what has been discussed with the client and how it has led to the recommendations being produced.
  • What the client’s specific objectives are. Don’t be bland here; objectives need to be personal to the client, rather than ones that we think apply to them.
  • What exactly you are recommending – including figures, share classes and whether income is required or not.
  • Why you are recommending it to this client – how it will meet their objectives.
  • Their appetite and capacity for risk – if relevant.
  • What fees are being charged – and how they are to be paid by the client e.g. from the product or by direct invoice.
  • Any future review services that have been agreed or are being recommended.

2. Make sure the fact-find’s up to date

This sounds simple enough, but we sometimes see fact-finds that haven’t been updated for several years – or more notably, ones that contain a mixture of out of date and up to date information. When you don’t know the client that you’re writing for, you have to rely on the hard facts noted within the fact-find to build a picture of them. If this data is incorrect, it can lead to some potentially serious errors occurring. Always give your fact-finds a thorough check before giving them to a paraplanner to write the report, to make sure the data is correct and relevant. This is particularly important in terms of the client’s income and outgoings, assets and liabilities. A lot of financial planning, research, and the tax calculations undertaken for the client are highly dependent on the accuracy of these figures.

3. If you need a cash flow forecast

Make sure you stipulate what you want your assumptions to be – e.g. growth and inflation rates – and what scenarios you want to look at. Cash flow planning is a key part of the financial planning process and it is extremely important that it is undertaken with accuracy; particularly as it frequently now forms the basis of the financial planning recommendations for many advisory firms. If we’re telling the client that they can afford to retire at 50 and live a long and comfortable retirement, then they do so and run out of money at 70 because it transpired we made a fundamental error in one of our figures, there is a potentially huge scope for come-back from that client. Whilst cash flow planning is of course based on assumptions and not guaranteed, we do still have a strong duty of care to ensure that the input and output is checked, consistent, and regularly revisited – otherwise we could potentially hang ourselves as an industry. When you ask someone else to prepare a cash flow forecast on behalf of a client they’ve never met you need to be vigilant to spot any errors or inconsistencies before the client does.

4. Striking the balance between too much and too little information

Too much information will take a paraplanner several hours to read through – often unnecessarily – and potentially increases not only your report costs, but also the risk of them missing something fundamental within the 90-odd pages of detail that are sometimes sent through. Going back to point number 1, less is often more – provided all the important details have been summarised succinctly in one place, this is a much better and clearer way of outlining your requirements both for the report writer and for anyone that later reviews your file for suitability.

5. Take steps to minimise costly changes

Every paraplanner expects that the adviser will want to personalise a report or make the odd change. However, it is unproductive, costly and can be soul destroying to spend several hours preparing a report, only to have to re-write significant parts of it because the information provided was poorly presented, or because the adviser changed their mind part-way through. It’s not dissimilar to when an adviser spends several hours working for a client, only for them to reveal something fundamental at the last minute that changes everything and sends you straight back to the drawing board. It happens, it’s sometimes unavoidable, but a few extra minutes spent double checking the report request and raw data before it is sent to the paraplanner will go a long way towards maintaining a positive working relationship with them.

All of the above points do of course relate just as much to paraplanners as to advisers.

Sometimes we make assumptions that turn out to be incorrect. Sometimes we could save ourselves a lot of time and hassle if we just picked up the phone and had a conversation with the adviser. Sometimes we make errors that are fundamental and need time to rectify.

We are all fallible and no-one gets it right all of the time.

It’s important that we remember that fact when communicating with our colleagues and peers. After all, doing the right thing for our client is the ultimate goal for all of us and it is in our interests to look after each other and keep the lines of communication open and healthy at all times.


This is the original version of Kim’s latest column for Professional Adviser and was published on 8 September 2015.