In an over-serviced market, a planner sometimes has to shine brightly to get noticed. Stephen Priestly is doing just that. Simon Hoyle reports.
It’s a crowded market north of Sydney, in Newcastle, NSW. Stephen Priestley, an adviser with Gordon & Gray, says something like 400 advisers, representing a multitude of licensees, ply their trade in the area.
That’s why receiving a 2010 Value of Advice (VoA) Award from the Financial Planning Association of Australia (FPA) was particularly valuable for Priestley. Not only did it acknowledge his professional standing, it gave him an effective way to stand out from the crowd.
“There’s 400 authorised representatives in the Newcastle area, it’s something ridiculous,” Priestley says.
“The market has changed over the last 10 or 11 years. Last year I was talking to one of the senior guys who keeps a record of all the clients that come into the office, and we had something like 200 new clients come into the office in 2000 – and that was among four advisers.
“Last year it was nothing like that. There were four main players back then and we were one of them, but now there are so many of them spread around. But I suppose that’s the nature of economics.”
Third-party endorsements, like VoA awards, add credibility to any adviser’s pitch; all the more when you’re in a highly competitive market and you’re 28 years old and purporting to advise clients 30 years your senior. Priestley says the case study he submitted for the award was both technically challenging and personally rewarding.
“The reason I put it in was to gain a bit of recognition for the work that I do, and from that hoping to get a bit of publicity to further promote what I do,” he says.
“But there were a few things that were a little bit different with the case. The lady came to me; she wasn’t in a great place when she saw me. And there were a few little things I did that made her feel, I can’t really think of the best word for it, but just knowing that she wouldn’t have to worry about money at a time when she was grieving.
“She didn’t know how she was going to support herself. Just using a little bit of knowledge, I showed her how to do it.
“She had debts from a failed business venture and she had a redundancy payout and superannuation. We paid off her debt, restructured her finances, put what was left over into an account-based pension – one that offered term deposits, because she wanted absolute security on the little bit of money she did have left over.
“She was being income-tested, so the best place for the money was inside the pension, and that maximised her carer payment. We got her onto a bereavement payment straight away, and when she was on that we got her assessed for the carer payment.”
Despite the professional recognition, Priestley’s career is in some ways in a transition phase, as he establishes himself in the profession.
“I started off in a paraplanning role and I did that for a couple of years and that’s where you build up technical knowledge, just through experience and dealing with the other advisers and clients,” he says.
“And then I moved into an advising role. You’ve actually got to be advising to qualify for CFP.
“It was quite easy. I still do a bit of paraplanning for the advisers here. The clients I have, I’ve built up from scratch, so I haven’t acquired any clients, or anything like that. So I do a bit of plan writing for the [other advisers’] clients here, and then look after my own clients. So the transition has been quite gradual. I suppose I’m still in a transition phase. It wasn’t a high-risk leap; it was more of a gradual ease.
“The guys here realised that being younger, it was going to take a while to [develop] contacts and build up a few clients, build a bit of trust and get a reputation.”
Priestley is in the process of building up his client book, currently looking after 20 clients directly and aiming to increase that over time to closer to 100.
“It’s not a huge number of my own, but I also look after other planners’ clients in the business,” he says.
“Clients talk to me on the phone and they don’t have any idea that I’m 28 and they come in and they’re a bit sort of, ‘Oh, who’s this kid?’. But I go through what I’ve done, my qualifications, go through the awards I’ve won. So when they come to see me they know my qualifications and awards – the FPA award last year; Smart Investor have their Master Class, and I’ve been in the top 50 the last three years. I got top five this year, and I was placed first in 2009. So just using those things as material.
“Even though they realise I’m quite young, and younger than they might have expected, that builds a bit of a reputation for me, and a bit of confidence in them.”
In recent months Priestley, in addition to dealing with the publicity surrounding his VoA award, has been occupied by Gordon & Gray switching dealer groups, from Godfrey Pembroke to Financial Wisdom.
“The main reasons were the product offerings,” Priestley says.
“Under the MLC banner, it was very restrictive. There were obviously the MLC products, I think there was Navigator on there, and I think in some cases they let us use Macquarie Wrap.
“With our clients we saw a good opportunity to use Colonial [First State] product and Colonial FirstWrap. The fee savings, going from MLC MasterKey Custom to FirstWrap, we’re talking thousands of dollars per client, so it makes sense.
“I don’t see the day-to-day operation would be too different. Obviously we’ve had to change our software, from Visiplan to Coin, and things like that, but [in] day-to-day operations there’s been no change, and from what our clients see there’s been a name change, and some of our clients will be changing platforms.
“We’ve explained to them the reason for switching is that they’ll be better off, under the alternative, or the new licensee, because it’s allowed us to offer you a wider range of products. With FirstWrap we can still recommend the MLC MasterKey platform – so a lot of clients will stay on MLC platforms where there’s no benefit in changing.
“And also, just a few changes within Godfrey Pembroke, from a business point of view; the two senior advisers here didn’t agree with what they were doing. If we’d wanted to stay with Godfrey Pembroke, they were going to force us to sell off all the trail brokerage, and the offer they put forward from a business point of view just didn’t make sense. So that was another factor in deciding to leave.”
Priestley says that while the firm has tried to make the process as smooth as possible for clients, it has entailed quite a lot of additional work within the practice, “and changing a few processes, in terms of compliance, as well”.
“GP had their requirements, but the Financial Wisdom requirements seem to be a lot more, in what they require,” Priestley says.
“I suppose it’s just a change in process; but we’re adjusting to it and it’s going along quite well.”
Priestley joined Gordon & Gray in 2004, straight out of university, where he completed a Bachelor of Commerce degree.
“In the last semester I started a Graduate Diploma of Financial Planning, and that was through then what was called the Securities Institute of Australia, now Finsia, before they sold off their education arm to Kaplan,” he says.
“That was quite good doing that. As I did my CFP, it fast-tracked me through the CFP process.”
Priestley says a career in financial planning neatly brought together two things he loves.
“Obviously, I enjoy finance, the technical side of financial planning,” he says.
“There were a couple of courses there at University [of Newcastle] that were to do with financial planning, and I went quite well in those. I’m not sure what they have now, but [then] they had a financial planning course.
“And also it was interacting with people, and helping people. I’d had a few customer service roles to pay my way through uni and just really enjoyed that interaction with people. It wasn’t too much – it was just Big W and places like that – but they’d come in with a problem and I’d find a solution for it, and I thought, well, I can combine that with finance, and that’s when I decided to go down that avenue.”
As a graduate looking to get into the business, Priestley had a few interviews before he found a home.
“I went to a few interviews before I got this job,” he says.
“I’m quite happy I didn’t get a few of those jobs. There’s one company in particular now that was on the 7.30 Report the other night.
“At the time I didn’t know; it was just luck basically. As a graduate, I was fresh into the industry. I did get a feel from the type of people who were interviewing me.”
With the benefit of hindsight, Priestley says there are a few key issues he’d advise new planners to focus on when appraising potential employers.
“I’d ask them how they determine what they invest their clients in,” he says.
“And the steps behind that; how they charge their customers; the turnover in staff, would be another thing. Probably those three things.”
Priestley’s enjoyment of the job comes from using what he knows to provide reassurance and guidance to clients who may be unsure of where they’re going.
“Seeing where a client’s at when they come to me – in a lot of cases their knowledge of where they’re at is not high – and they’re retiring in the next few years, in most cases, or about to retire, so they just want an idea of where they’re going,” he says.
“And to show them that, to give them an idea of how we can achieve what they want to achieve in terms of meeting their income needs for the next 30 years, that gives me a nice feeling, to show them that kind of thing.
“And on a personal level, growing the business. In the end, that’s what I’m here for. Firstly to service clients, and then to grow a business.”
Gordon & Gray is a small firm – there are four advisers, including Priestley – and their approach to solving client issues is quite collegial.
“If it’s a case that’s quite involved, I discuss it with the other advisers and basically we draw on our knowledge; run it by the other guys, and if they can think of anything else then we add that, and there’s also technical back-up from the licensee, and we use that extensively in complicated cases,” Priestley says.
“Godfrey Pembroke were quite good. What I’ve seen of Colonial First State technical advice, they seem quite good, so I’m quite confident in that area.
“I don’t think the number of advisers would increase substantially. We may be looking to employ a paraplanner so they can take a bit of the [workload] so I don’t have to spend as much time looking after other advisers’ clients.
“[Client growth of my own] is the main focus.”
Name: Stephen Priestley
Position: Adviser
Years in financial planning/financial services: 7
Qualifications: Bachelor of Commerce, Graduate Diploma of Financial Planning, CFP
Industry background and experience: Graduated from Newcastle University in 2004 and started working at current business as a paraplanner. Continued studies to become an adviser. Named top of Smart Investor Magazine’s Masterclass Awarded the FPA’s VoA Award in the Post-Retirement Planning category.
