Welcome to Grove Paraplanning’s blog. In commencing this blog I thought I would first address the use of contract paraplanners. Using an external service may be something you are considering as a way to gain control of staffing costs or manage excess workload.
In this interesting financial time we live in I feel creating efficiencies within any business is a must. Contract Paraplanners have evolved to fill a space in the market previously filled by full time, in-house staff. Many financial planning businesses are realising that it is just not cost effective to maintain a paraplanner on staff.
It is interesting to note an article from Money Management discussing adviser employment demand. The article states there has been an increase in employment demand for financial advisers however demand for paraplanners has slowed. In relation to this, paraplanner salaries have also dropped markedly from their pre-global financial crisis highs. As the legal requirement to produce Statements of Advice has not changed this leads me to think advisers are either making do alone or using an off-site service.
There are several benefits to commencing a relationship with an off-site service with the main benefit being you only pay for what you use. There is no requirement to pay the paraplanner when you do not produce any work. There are no ongoing costs associated with retaining a staff member such as superannuation, annual leave and sick pay. You pay for a product (the Statement of Advice) and it is delivered as per the service agreement with the contractor. Further, many contractors offer other services such as back office support and strategy consultation so you are able to access all the benefits of an in-house paraplanner without any of the negatives.
Another point to consider is career advancement. Many paraplanners are looking to one day become financial advisers themselves and their time spent paraplanning is considered a key step on the path to fulfilling this goal. Hence an adviser may find that their very competent paraplanner leaves within a year to pursue the next opportunity. Training new staff is obviously costly and time consuming and something that can be avoided when using a paraplanning service.
Many advisers however are reluctant to take the step towards an off-site service believing they have more control if they have an in-house paraplanner. In my opinion, off-site contractors need to counteract this opinion by offering a very personalised service as well as guide the adviser so that each party has a positive experience. To this end communication is key and as an adviser you will gain the most out of your experience with a contractor if you are clear with your expectations and requirements.
So how do you go about finding the best off-site service to suit your needs? Firstly you may like to consider your Dealer Group. Do they offer a paraplanning service? If they do, you will likely find the paraplanners are well versed in your Dealer Group’s standards and compliance procedures. Often though Dealer Group’s offer paraplanning as more of an afterthought and you will obtain a more personalised service if you look outside this sphere. Do some research – Google contract paraplanner, ask your colleagues and make some phone calls. You will likely come across a service that is perfectly suited to your needs.