The world is not standing still – neither should your financial advisory

Lizl Budhram, Advice and Product Strategy Manager at Old Mutual Personal Finance provides a few useful conversations to have with your clients, and some tips on how to set yourself up to become an even more effective advisor in a rapidly evolving world:


As we look back over the past 18 months, we are left with no doubt that the world we once knew has changed and some of these changes will be permanent. Accordingly, businesses need to continually adjust and adapt to ensure they are competitive and relevant, but even more importantly, they must provide value for clients whose worlds and needs have also changed. It’s no different for financial advisors.

The year 2021 was a singularly unusual year and it is likely you will require in-depth check-ins with your clients to make sure their financial plans are still on track. Where a client is lucky enough not to have had to endure cashflow problems – meaning there are no negative impacts that require mitigation or adjustments to the plan – a review of the plan is an ideal opportunity to take advantage of unusual investment and planning opportunities presented in our new environment.

Here are a few useful conversations to have with your clients as you take stock of the past year and adjust plans, and some tips on how to set yourself up to become an even more effective advisor in a rapidly evolving world:

Relook the risk conversation

It is an ideal time to review the client’s view of geographical, political and currency risks – don’t be surprised if this has shifted significantly. Revisit your asset class and investment risk conversation to ensure the investment portfolio remains suitable given the significant changes and market events experienced since the onset of the global pandemic. Make sure your client does not have too much or too little investment risk in his or her portfolio.

Estates and wills

There is still an alarming number of South Africans without wills. We are seeing that from a compliance perspective, if the advisor does not drive the conversation and cannot show that he or she has done so, there could be liability for the advisor in the event of the client passing away, with questions being asked as to why the advisor did not make sure a will was in place. If anything, the past year has shown that there is no time to spare, and that you should ensure that all your clients have up-to-date wills in place.

The pandemic has been a revelation for everyone in the industry, especially around the practicalities when it comes to winding up an estate, and how theory does not necessarily align with practicalities. Beyond that, because so many estates have needed to be wound up as a tragic result of the pandemic, advisors are increasingly finding that it’s not just the technical financial requirements that need to be on point, but beneficiaries often also rely on the advisor for emotional support and stability because the advisor is an arm’s-length third party that can provide clarity through a very difficult period. There are great tools and guides to assist clients and dependants that address all the logistics requirements when a family member passes away.

An especially important lesson for advisors in terms of winding up estates is the impact on retirement funds. The trustees of the pension fund will exercise discretion and decide how the benefits will devolve. If plans and decisions were made when the client’s children were minors but they’re now adults, or if the client has been divorced and remarried, the way things play out can alter fundamentally – be sure to understand this and stay on top of it with your clients.

Optimise your plan

Essentially, you want to eliminate all wastage. The pandemic has underlined how important it is to make sure you make the best use of your own, and your clients’ money. Take a step back and reconsider financial habits and plans in this new light. Make sure the right benefits and amount of cover are in place.

Ask these questions:

  • Are you wasting money on benefits that are no longer required or suitable to your needs?
  • Are you optimising tax benefits such as retirement annuity contributions or donations?
  • What are your spending habits?
  • What bad spending habits need to be adjusted and how can this be achieved – for example by using the 22Seven app, which is a great tool to help customers understand their spending habits?
  • Is money sitting in an account somewhere earning returns equal to or less than inflation? Where can this money be invested to make a real contribution to the financial future of your client?
Spend time with your business clients

Small businesses, like people, have had to endure an exceedingly challenging time. Those that survived have been through a lot and may have changed their shape meaningfully. Take time to sit with the business owners to understand the outlook of the business, but also the strategies that are likely to have shifted. Their appetite for risk – in the context of navigating a Black Swan event – is likely to have shifted. Therefore take the time to consult with them and give them the peace of mind they need to keep running a small business in South Africa’s economic climate.

The pandemic has underlined how important it is to make sure you make the best use of your own, and your clients’ money.

Look at technology

Fintech is evolving at breakneck speed and the types of products and services available would have been unimaginable only a few years ago. The benefit of digitising a business is that it takes the burden of repetitive, mundane work off the shoulders of an advisor, and frees their time to work with clients and add more value. In other words, let the machines do the heavy lifting, and you bring your human touch to your clients.

Advisors should take the time to look at what’s available and then look at their practices and decide which tools are best suited to their individual businesses. Remember, the key is to choose an investment in technology that frees up your time to engage with clients – not technology for technology’s sake.

Naturally, there will be a cost implication. So, if you are certain the platform will save time, improve efficiency in your practice and help you provide more value to clients and bring in more business, then consider how you should plan to purchase the tool.

Lizl Budhram, Advice and Product Strategy Manager at Old Mutual Personal Finance
Do you understand cryptocurrency and non-fungible tokens?

While the world of blockchain and crypto is not yet mainstream it is certainly all over the news and we are finding that more advisors are being asked for advice by their clients. It is a reality and is likely to continue growing in popularity, which means that advisors should start reading, learning and understanding what crypto is, how it works, and how people and organisations are investing in crypto.

Start with the fundamentals. What is the blockchain? What are the most popular cryptocurrencies? How do you identify scams? Which platforms are legitimate and provide protection? What happens when someone dies, and no-one knows their unique pin to unlock their investments – what plans are in place to ensure this doesn’t happen?