Marie Ainsworth, Managing Director at Mount Street Group and CERTIFIED FINANCIAL PLANNER™ professional, brings over two decades of experience and hard-earned wisdom in the financial services industry. In this article, reproduced from the November 2024 edition of LIA’s ‘The Advantage Magazine,’ Marie shares the key lessons she’s learned along the way, from practical insights to tough challenges and the business practices she wishes she’d adopted earlier. Her journey offers valuable takeaways for anyone looking to launch or grow a financial planning business.
Introduction
For some context, I began my career in the industry as a pensions administrator at a life insurance company before transitioning to an administrative role at a brokerage. Subsequently, I became a pensions account manager and worked in this capacity for various stockbrokers and pension brokerages.
Approximately 20 years ago, three colleagues and I were approached to set up a joint venture with a stockbroking firm who would introduce us to their affluent clients for us to provide pensions/protection services, provide premises and some initial capital.
We eagerly accepted and handed in our resignations. Within a year, referrals were almost non-existent; the parent company had issues with their regulator and shortly thereafter, a liquidator was appointed.
On the positive side, we purchased all the shares from the parent company at a hugely discounted rate.
On the negative side, our client base was minimal, we had no premises, and hardly any money to pay overheads let alone ourselves.
This marked the beginning of what became a standard 60-hour work week. Before long, we generated enough revenue to hire our first administrator. One partner, Brian, excelled at computers and took on the task of creating a customised CRM system, which was so good we eventually sold it to a developer. Consequently, our administrative and marketing processes were efficient from the start.
We hired experienced staff whose responsibility was to both retain clients and identify new business potential which was then passed to our sales consultants. The ability to communicate frequently and effectively with all our clients (via email) was fundamental to the company’s growth, leading to a steady increase in new business, fees, and renewal income year after year.
We sold the business approximately 10 years later.
Too young to be idle, Brian and I founded Mount Street with three other shareholders. Over the next five years I bought out the shareholders and now own the business myself (of course it wouldn’t exist without the support and input of my husband, Mike).
Against that backdrop, I have been asked to reflect on and outline what guidelines I now follow which I wish I had implemented years ago (all learned the hard way of course – I will spare you the worst of my war stories as they might put the fear of god into you, but I have so many more that would both ‘craic you up’ and leave you thinking ‘this is definitely who I am and what I want to do’.)
However, if you asked what the most important piece of advice I would give, it is this: review your management account data weekly.
Write a Business Plan
Funding/Cashflow:
Ensure you have sufficient capital to sustain operations until profitable e.g. identify your expected operational expenses for the first three years such as rent, gross salary, subscriptions, VAT, CRM costs, insurance, phones. This figure will be your minimum annual sales target. You must allow for time off, illness and months when you didn’t make target –consider spreading the annual target over nine months and not 12.
Put as many bills as possible on monthly/bimonthly direct debits to evenly distribute expenses throughout the year. Open two bank accounts: one for revenue and another for operational costs such as PAYE, VAT, insurance. Transfer monthly from the revenue account to the second account an amount equal to, say, 1/9 of your operational costs (hopefully at year end you will have a surplus in both accounts).
New Business Strategy:
How do you plan to get in front of customers? You need a mix of warm leads but also a marketing strategy running alongside your weekly sales plan to generate future appointments. It can take some months of communicating with a prospect before you get an appointment and perhaps another couple of months before you are paid. Optimise your website, social media, networking within your own social groups/sports clubs and business connections, etc. especially accountants.
Financial and Management Accounts
Hire an accounting firm to manage your financial accounts, VAT, PAYE, tax returns and corporation tax. Use management accounting software (as results are also shown graphically) to give you instant visibility on your bank balances, debtors, costs, sales vs other periods while allowing you to focus on revenue-generating activities.
Technology
Start by
(i) investing in a CRM system from day one to store client data and communicate efficiently with groups of clients, and
(ii) investing in a financial planning tool such as CashCalc or Voyant. I demonstrate (using a sample client) the features of a financial planning tool to prospective clients to allow them to see what they can expect from future reviews when they become a client of Mount Street.
(iii) Utilising software tools to improve client experience and boost efficiency e.g. I use dictation tool built on my tablet after meetings so that action points for staff can be immediately communicated.
Industry Resources
Stay updated with resources like Brokers Ireland and TAG to keep abreast of industry trends/regulatory changes. Outsource HR tasks for assistance with interviewing/personality tests, employment contracts and reviews.
Comply with Regulatory Requirements/Industry Standards
Get acquainted with and adhere to all relevant financial regulations and licensing requirements. Attend lots of protection and investment/pension webinars with the likes of LIA, FPSB, life offices.
Financial & Regulatory Calendar
From a workflow perspective, log crucial dates in your calendar to ensure these important tasks aren’t missed e.g. start of annual audit, year-end accounts, Central Bank return, fitness and probity returns. Plan your holidays such that you don’t have to work when away!
Staff/Recruitment
Assemble a team which contributes knowledge and experience to your business. If mistakes happen, address them swiftly, particularly if other staff members are affected, and utilise your HR resource.
Clients
Be disciplined with your onboarding procedures and reviews. If you aren’t utilising a financial planning software or your CRM system to on-board your clients, the process is time consuming. Establish trust with your clients and ensure regular communication.
If you work from home, so too will many of your clients so be aware of a decent hotel or venue in different areas which you can use when a Teams meeting is not appropriate.
Assign a value to your time.
Determine your own hourly rate and be aware of how much each client contributes relative to this rate. Introduce a minimum fee, and if the expected commission/fee isn’t going to cover your time, charge the difference. Since I started to put a value on my time, I no longer hesitate in charging an additional fee.
More recently I have started to resign from cases where clients cannot commit to an adequate fee (clients do understand that you have overheads and have to pay staff – such clients have agreed to deal directly with a provider).
Dedicate most of your working hours to paying clients or activities that help attract new business. Learn to distinguish those who are merely browsing and reserve your free services for charities/deserving individuals – it’s very easy to become ‘a busy fool’. Don’t give away too much of your hard-earned knowledge too soon – if they don’t come on as a client, they will have received your best advice for free.
Work Ethic/Life Balance
There will be times when you feel overwhelmed with work. Whenever possible, delegate tasks and then prioritise what needs to be completed and when. Occasionally, long hours are inevitable but if constant, you need to take a step back and assess what needs to change.
Make sure to allow for family time and personal time!
Renewal Income Business Model
It is essential to create a business model that incorporates recurring income e.g. fees, renewal premiums, trail income to support you through economic and/or market downturns.
A strong renewal income stream will make your business infinitely more appealing to prospective buyers in the future.
Regularly revisit your business plan to assess whether you are meeting your initial objectives.
Maybe your initial plan was overly ambitious? Be candid with yourself; either realign with your goals or adapt the plan accordingly.
I am a firm believer in the concept of paying it forward. Be open to seeking advice and support from your peers, whether in the planning stages of opening a new business or a recently started one. Get to know a group of intermediaries, consider meeting quarterly as a group — everyone will gain valuable insights from each other – especially crucial if you are working alone.
On balance, working for myself has been the best life choice.
