David Pereira never doubted his love of financial planning. The 31-year-old was raised in a household with plenty of love, but very little money.
“My parents grew up in Kenya and my father was a manual labourer whose fingers were cut off in an accident,” he says. “It made it really hard for him to work, and I learned very early on the value of money and good income protection, which we didn’t have.”
Pereira studied hard at university to break into financial planning, but three years as a paraplanner during the GFC – a tough gig by anyone’s standards – convinced him of the need to keep adapting and changing.
“With the market dropping, so too did the funds under management,” the Perth planner recalls. “Charging clients on a percentage basis meant the firm’s income significantly decreased, even though our workload remained constant. The lesson learnt for me, personally, was in seeing these significant shortcomings and dangers of charging on a percentage basis.”
Pereira was interested in working for a company that was a little left of field, one that not only used a fee-for-service model, but did things in a different way.
In 2009, he read an article about Crown Money Management, a mortgage broker and debt management company that focuses on ensuring clients own their homes as quickly as possible.
“I decided to email the director of the firm to see if they needed a paraplanner in their wealth division,” Pereira says. “Until then, I had only seen advisers work with clients on taking out risk insurance, moving super funds or, occasionally, investing personally into managed funds or equities. While there is long-term value in offering these services, the idea of actively working to get clients out of debt really appealed.”
Pereira started writing statements of advice for Crown Wealth Management – the financial planning spin-off arm of Crown Money Management – and it wasn’t long before he was starting to see his own clients at night, mostly people 55 years old and older.
The reformed adviser
Pereira believes the simple act of paying down a mortgage ahead of time is an under-rated facet of good money management.
“People don’t pay enough attention to how much money they pay over a lifetime in interest on their loan,” he explains. “It’s often twice the amount of the [price of the] property, so that is why our focus is on paying down that debt in seven to 15 years, which frees the client to focus on other financial goals.”
Today, as one of two senior advisers with Crown Wealth Management, the majority of his clients are in their 40s and 50s and run self-managed superannuation funds.
He charges a flat fee for service, and while he has trailing commissions on insurance, Pereira says he is looking for a replacement model that saves the clients money.
He has also started a blog, The Reformed Adviser, which has led to a number of new clients, particularly younger ones, contacting him for advice.
“I posted one particular blog, ‘How to Prioritise Your Spending’, on social site Reddit and it went crazy,” he says. “At last count, it has had 21,900 views. The appetite for personal finance advice is really strong, which is great.
“Too often, I would sit down with someone 10 to 15 years out from retirement who would say they wished they had started putting money away for retirement a lot earlier. By working with those in their 30s, we can make a massive impact on their lives.”
Name of firm: Crown Wealth Management
Name of licensee: MyPlanner Professional Services Pty Ltd
Time in the industry: 11 years (ASIC authorised representative number since 2010).
Academic qualifications: bachelor of business law; graduate certificate in Australian migration law, graduate diploma in financial planning, master’s degree in applied finance
Accreditations: Financial Planner AFP
Professional association memberships: Mortgage & Finance Association of Australia, Financial Services Institute of Australasia, Financial Planning Association, MIA
Other memberships: AISWA
