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Demystifying Wealth Management

We interviewed Richard Venner, Director of Financial Planning and Mark Merten- Jones, Senior Investment Manager in our Birmingham office to get their perspective on how they collaborate to deliver wealth management to their clients.

| 8 min read

Charles Stanley’s wealth management service combines both Financial Planning and Investment Management to address the needs of clients. It’s a consultative service, the financial planner creates the framework for the clients’ needs and aspirations and the investment manager tailors the investment strategy to fit the framework. The service is delivered by both the financial planner and investment manager working together; they combine to ensure the plan meets the aspirations and goals of the client’s needs and wants.

What is Wealth Management and how do we work together?

Richard Venner: Wealth management is the combination of financial planning and investment management – the need to identify the short, medium and long-term goals and the ability to manage investments to meet the objectives. Mark and his investment team in Birmingham work closely with the financial planners to achieve these objectives for our clients.

Mark Merten-Jones: Wealth management in simple terms is having a better understanding of a client’s financial position, where they are currently, where they would like to be in the future, and the most tax-efficient means of achieving that goal with the least possible level of risk.

As with many clients, their finances are often less straightforward than they would appear from the outset.

Older clients have concerns about IHT and protecting their wealth for future generations. Younger clients consider planning for their children, pensions and later retirement. In my experience working alongside Richard in Financial Planning, we gain a greater insight into our client’s position and can offer them consistent and valuable support by working together.

What level of service do you provide to clients we work closely with?

Richard Venner: We work very closely with clients and try to be on time all the time! A good example of winning additional mandates happened last week – we were appointed to advise a prospective client of mine in 2018, with the client initially investing £750k. We knew he had considerable assets held with another IFA – we have met with the individual twice yearly since 2018 and last week he asked us to manage the portfolio. An additional £1.7m will be transferred and invested with Charles Stanley.

Mark Merten-Jones: The investment team are responsible for the suitability of the client’s portfolio, daily monitoring of the risks and objectives, and reporting to clients on a quarterly basis, whilst holding regular meetings with our clients.

The financial planners are responsible for the suitability of the structure, whether that be funding pensions, looking at drawdown, or considering IHT planning etc.

With many clients, we hold joint meetings to discuss changes in financial position, the performance of the portfolio. These (at least) annual meetings ensure the relationship remains strong. In turbulent markets, as we saw back in March 2020, clients took considerable reassurance from being able to speak directly to the investment team and me personally. We sent out to both the financial planners and clients the rationale in restructuring portfolios to take advantage of the opportunities that arose from the widespread market sell-off. Because clients had two points of contact during this time, they remained assured that we were able to navigate this volatility and continue to meet and achieve their long-term objectives.

The investment team is also in constant contact with the financial planners so that they are also fully aware of the rationale behind investment decisions and portfolio restructuring. We produce at least quarterly and often monthly investment updates for the financial planners so they can understand the investments we make, the reasons behind them and the performance of the portfolios against the relevant benchmarks.

What do clients value most about Wealth Management?

Richard Venner: private-client relationships are principally personal. The client trusts the planner and, in trusting the planner, they respect the view of the adviser/investment manager. If wealth management is all about advice and investment management then my view is that a client is best served from having two experts – one for advice and one to manage the objectives – it’s not complicated!

Mark Merten-Jones: Having two points of contact and knowing that each has their best interests at heart. It should never be underestimating the reassurance clients receive when they can make regular contact to both the financial planner and investment manager. Regardless of how sophisticated an investor is, being able to speak to an investment manager for reassurance ensures that clients can see the benefit of having a professional make investment decisions for them to either protect their capital or take advantage of opportunities that arise from volatile markets.

What advice would you give to individuals in their 20s and 30s?

Richard Venner: The earlier you start planning and saving, the better off you will be in later life – investment and wealth are fundamentally driven by the compounding effect over time. The best example I can give is when I first advised a newly qualified solicitor in 1991. By 2017 the client had sufficient wealth in investments and pensions to retire from mainstream work, spend more time with her daughters and be in control of what she wanted to do rather than let life dictate what was needed, the client’s wealth built from zero to in excess of £1m over that time.

Mark Merten-Jones: It is never too soon to start planning for your future, whether saving into ISA’s or pensions, and the sooner a client has a plan to focus upon, achieving those goals becomes easier. My eldest son is in his late 20s, working in London and he and his partner have started saving towards a deposit for a house and additionally maximising their pension contributions for the future. It was important to me that they became more investment savvy because it will assist them in achieving their goal of becoming homeowners. They will also inevitably inherit from their grandparents and hopefully significantly later from myself. The experience they gain now from owning investments should put them in good stead for when these days occur.

How does Wealth Management make a difference to people’s circumstances?

Richard Venner: In the past 30 years there have been many legislative changes. This, coupled with the individual and family circumstances, mean that wealth management has a huge part to play in ensuring that an individual and family’s needs and objectives are met. It is all about building, preserving, and enjoying life. To do this, it would be abnormal not to seek advice to gain peace of mind. If I was ill, I would not self-diagnose my illness, I would seek advice from a doctor who in turn would diagnose my situation and advise me accordingly. If I needed a specialist, the doctor would refer me to the consultant. The analogy of wealth management is the same.

Mark Merten-Jones: If a client’s wealth is structured correctly then achieving their goals becomes simpler; they know where they stand and what they need to do to ensure financial wellbeing. For me, the starting point should always be structure, utilising any tax advantages now will pay dividends in the future. Working with a financial planner helps minimise income tax, capital gains tax and inheritance tax – these are clear and easily seen benefits that clients can easily achieve. Once the structure of a client’s investments is agreed, it is far easier for an investment manager to manage a client’s wealth without creating tax liabilities that could be avoided.

How often do we speak about clients that we manage jointly?

Richard Venner: In a normal week we speak and meet about two or three times. If you care about your clients, they care about you and have peace of mind that their finances are in a safe place.

Mark Merten-Jones: On a regular basis, if a client contacts me directly, it is in my interest to pass that information on to Richard and vice-versa. The investment team also provide regular updates to the financial planners to ensure they understand the activity on a client’s account and the rationale behind those decisions, this leads to a very joined up offering to clients and is very reassuring for them.

Nothing on this website should be construed as personal advice based on your circumstances. No news or research item is a personal recommendation to deal.

Demystifying Wealth Management

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