I know that many of our clients will have received letters in the past weeks, telling them of investment platform name changes.
I wanted to offer some of our thoughts in regards to these changes – and to tell you of our plans at Thomas and Thomas to try and minimise disruption for our clients.
What platforms do for us and our clients:
An investment platform is effectively an administration ‘supermarket’ where we can purchase and switch funds for our clients. Thanks to our own well established tools and processes, we are able to use these platforms to help save our clients’ money and time.
We have no control over these platforms and so we are constantly checking that they are providing a reliable service to our clients. In the main, we currently use Old Mutual Wealth, Co Funds (Aegon) and Fidelity for our clients’ financial plans.
Which platforms are currently affected?
There has been a huge amount of regulatory change and pressure for platforms to absorb in the past few years. This has led to many platforms selling out or merging as profit margins have been squeezed. Our concern throughout all of this time has been our clients.
Recently, Co Funds was sold to Aegon and Old Mutual Wealth split its component parts with the platform side of the business to be branded ‘Quilter’.
Many other platforms have gone through various changes in the past six months or so, but what does this all mean for you?
Co Funds to Aegon – what does it mean and what are we doing?
The takeover of Co Funds by Aegon was fairly swift and non-consultative. Aegon moved quickly to ‘upgrade’ the platform and rebrand it. In reality, the upgrade led to (at least a temporary) loss of some functionality from our side. Initial service levels plummeted to an all-time low as our clients and ourselves experienced terrible trouble even getting to speak with a person at Aegon.
This situation is now improving slowly, although there is some way to go. In some instances, we have moved clients to another platform at no fee if they have been at all concerned. In the main, we are hopeful that the Aegon platform will improve and therefore we are prepared to wait another six months to see how things go. If you are on the Aegon platform and you want us to check your position – just let us know and we will do this at no fee to you. Otherwise, we shall cover this in your annual review.
Old Mutual to Quilter – what does it mean and what are we doing?
Old Mutual was a huge global investment company that bought out the old Skandia platform back in 2014. The break-up of Old Mutual means that the platform business will now be rebranded again. Whilst we never like to see disruption – we think this may suit the Southampton based business who still retain much of those original Skandia staff and support.
The ‘Quilter’ name comes from a discretionary manager that Old Mutual purchased a couple of years back. It probably wouldn’t be our first choice – but from experience – I expect the name to bed in successfully.
Quilter will be running a pilot of their platform upgrade in the coming months. Out of the thousands of IFA firms that use them, they have selected 50 firms to really ‘road test’ the new system before it goes out live to the public. Thomas and Thomas are one of the specially selected firms.
We look forward to working with the team at Quilter to find any problems and learn the new system in advance of our clients and peers. This consultative approach seems much more sensible to us and we are hopeful that the rebranding of Old Mutual will run much more smoothly than other recent ‘upgrades’ by various platforms.
Who is responsible for your investment portfolio and financial planning?
In this new world, the platforms are increasingly seeing themselves as ‘providers’ of financial solutions as opposed to ‘enablers’. This is a thin grey line as there can become confusion as to who the ‘adviser’ actually is.
We want to unequivocally reassure our clients that we are responsible for all of the financial advice that is provided. We select and monitor your funds and ensure your financial plan is on track. We will only work with platforms that enhance our service to you. A good platform needs to allow us to continue to deliver our own individual, independent and unique financial planning service. They must enable our client to hold the funds and wrappers that we recommend – without any hassle for our clients.
The day they fail in this objective is the day that we seek to move our clients to another platform.
Summary:
I apologise for this rather dry and long article but I wanted to try and put everyone in the picture as I know it can be unsettling to receive letters telling you of name changes. We will continue to run our full quarterly ‘platform check’ to assess the suitability of your platform and the costs associated with it – if anything changes dramatically we will tell you.
As always, we are here for you 100%. Please just call or email if you have any concerns or questions at all.
My very best wishes
Darren
