We are pleased and honoured that our clients gave us an overall rating of 5 out of a possible 5 on service! We have worked very hard to deliver that service and those results are extremely gratifying. We can, of course, always find room for improvement and we believe that a continual review of the processes and systems allows us to ensure that the service we provide is first class.

We are very pleased to say that the results were overwhelmingly positive.

Summary of Results (All scores are out of five.)

• Overall satisfaction with relationship with Index                 5.0 
• Calls are returned promptly                                                    5.0
• Clients would introduce friends, family and colleagues      4.9

You might also be interested to know that our clients say that the two things that are most important to them in any relationship with a financial advisor are:

• Having a clear plan in place to meet goals
• Having an advisor that is trustworthy

Thank you to all who took the time to complete the survey.

“Today’s children will have 10 to 14 jobs by age 38″ (United States Department of Labor).

Our comment

Sounds plausible to us, but as parents or grandparents, we may have been conditioned to the expectation that company loyalty will be repaid in the form of first-class benefits (such as top-quality pension schemes) and is highly desirable. These benefits are largely disappearing and given increasing job mobility perhaps we should look on calmly as our children/grandchildren move around regularly. The other side of this coin is that they will largely be responsible for their own financial security, later in life, whatever form it takes, which is the subject of an article in itself.

“One in four workers has been with their current employer for less than one year. One in two workers has less than five years service with their current employer.” (United States Department of Labor).

Our comment

If you or somebody dear to you is an employer you can either live with this or gain a reputation as a first class developer of talent, which may encourage staff to remain with you longer; there will be swings and roundabouts, of course, but in the long run both parties should benefit immensely. If you or somebody dear to you is an employee, seek out these enlightened employers.

“There are over 200 million registered users of MySpace.”

Our comment

Technology moves fast! Even at the time of the AGM, MySpace was in trouble. It has changed hands twice, the first time to Fox for $580 million in 2005 and then in July 2011 to Specific Media (controlled by Justin Timberlake) for a reported $35 million – ouch! This website has been almost totally eclipsed by the rise of Facebook and who knows where Facebook itself will be in 10 years time? Always remember Dan Sullivan’s adage, “the level of technology you are using at any time is sufficient for you.” The likes of Skype and Facebook can be invaluable in keeping in touch with far-flung relatives and friends and increasingly, social media is seen to have a business application, but stay flexible and don’t be seduced by sexy new applications.

“There are 540,000 words in the English language, five times as many as in Shakespeare’s time.”

Our comment

The average English speaker has an active vocabulary of 10 to 20,000 words. We suspect that many of our readers will not be regular users of a number of new words, such as “chillax”, but all the same, there are lots of words out there to be learned and applied and it might be fun to look up one or two a day and add them to our own active vocabulary.

“One week of the New York Times contains more information than one individual would have come across in a lifetime in the 18th century.”

Our comment

The New York Times is a fine newspaper, similar in many ways to our own Times or Telegraph; the question here of course is how much useful information do they contain and how much of it do we apply to our day-to-day lives? Our answer is, “very little” as, almost by definition, most of the information is necessarily superficial. Take your own area of expertise, reflect upon articles you have read in the newspapers in this area and then you have a clear idea of how even the most informed journalist is only able to skim the surface of any subject. Our view is that they provide a starting point but you must supply your own depth and keep plenty of salt available.

Finally, we are indebted to Index client, Alistair Cochrane, for an interesting fact from the book “Funky Business” by Kjell Nordstrom and Jonas Ridderstrale. Apparently, men’s public toilets have become much cleaner over the past 10 years; a highly desirable outcome and we will all have our pet theories as to how this has come about, from higher standards to better cleaning. The authors’ theory, however, is that the rise of smart phones has led to more men sitting down, enabling them to check e-mails or play games whilst using the facilities.

Our comment

The Lord moves in mysterious ways!

http://www.innovationamerica.us/index.php/innovation-daily/2024-what-sony-played-at-its-annual-shareholder-meeting-this-year 

Paul McCartney, Sunday Times, 29 January 2012

He certainly can talk like that, Sir Paul. As one half of possibly the finest songwriting duo of the last century he can probably say whatever he likes about songwriting and be right. You might well consider he is right about this aspect of their songwriting, “Structure”; many, many Beatles songs have been covered by huge numbers of other artists and I would suggest you will be hard pushed to name those who have improved the songs. Unlike Bob Dylan, any of whose songs are invariably improved, whoever sings them, as long as it isn’t him!

Structure is important in so many fields; without it ideas have no form and often make no sense. Structure suggests solid foundations and robust constructs, underpinned by logic and good sense; in the absence of structure we, as human beings, lack guidance and direction.

Great lyricism and musicality may seem a long way from the mundanities of financial portfolio construction, but it is the similarities, particularly of structure that guarantee longevity and quality in both fields. Apply great structure to your portfolio and you will be happy with it long beyond the point when you “… get older, losing your hair, many years from now.”

Whilst we advise always making a will, there are steps you can take to ensure that “Contentious Probate” will not affect how your assets are distributed among your loved ones: –

• A letter of wishes can give voice to your preferences, where there is room for doubt.
• If there is a possibility of dispute, then setting out the reasoning behind your bequests will be a great help.
• Reviewing your Will regularly with your lawyer, to take account of any changes in the law or your own circumstances.
• Discussing with your family how your estate is to be distributed on your death, so that there are no surprises.
• Appointing at least one executor who will have a great deal of knowledge about you, your wishes and preferences.

Whilst few of us wish to actively contemplate our own mortality, paying attention to the above and taking these common sense steps may well save time and anxiety for your beneficiaries.

Thank God for progress I hear you say, although there will be those who consider the above process led to very much more responsible lending to people who had proved they could be responsible borrowers. Building societies were really local or regional savings banks with a very straightforward business model, which as mutual organisations, allowed them to make a small surplus each year in a very controlled environment.

Once they had overtaken the banks as the main mortgage lenders in the UK sometime in the 70s this was never going to be enough for them and, come the revolution, in the form of the Building Societies Act 1986, they were allowed to demutualise and, over time, to offer all kinds of services to their customers whether they wanted these services or not. Predictably, their numbers fell from over 200 in 1986 to fewer than 50 today and only one of any real size and importance (Nationwide). Many have fallen by the wayside due to the hubris of their shiny new boards comprised of city whiz kids (Northern Rock comes to mind) and many famous names have disappeared altogether.

The Halifax, however, still survives, albeit as part of the dreadful mess Lloyds has inherited and which resulted in the taxpayer becoming a major shareholder in the bank. The Halifax now runs a sharedealing service and recently as part of this service has begun to promote “spread trading”, which you might recognise better as “spread betting”. They are even offering free credit in order to induce new customers to take this up. It is understood that more than 80% of spread bettors lose money on a regular basis (I would guess this 80% is made up of the general public), but strangely this statistic does not appear on the website; Halifax are more interested in telling us about the tax benefits when you make money – which won’t be often!

A “service” further from the aims and values of the founding fathers of these august institutions it would be hard to imagine; we can just picture the headlines when some poor “punter” (because let’s face it, we’re talking about betting here) finds himself poverty stricken as a result of ill-advised “spread trading”. As a sign of what the banking business has become in recent years and perhaps as a sign of what it would like us to become , we couldn’t envision a more graphic illustration.

The flowchart above left represents the current situation for many of the clients of advisers. A product is manufactured, loaded with commission to incentivise the salesperson (variously referred to as a planner, adviser etc); the salesperson then finds a customer and shoehorns the customer into the product.

The chart above right represents best practice all over the world and is soon to be imposed in the UK when everything changes for advisers and clients on 1 January 2013. We have been fee advisers for many years and this chart represents our working practice; fees are agreed between client and adviser and the adviser then sources independent investment solutions, which expose the client to suitable asset classes for their investments.

The attached document (click here) tells the story of an adviser working under the “old model” and demonstrates the pitfalls for clients and adviser of that process. Not only could the adviser not develop her own strategies, she consulted a manufacturer for a product which turned out to be totally unsuitable and pinned this product on the clients. In this case the manufacturer (Zurich) shared the subsequent liability for the unsuitability, but all parties have suffered, due to the inherent weaknesses of a system which does not put the client first.

Legg Mason have taken a number of Time covers which chronicle market downturns in the US and placed them on a timeline, the backdrop of which is the performance of the S&P 500. With titles like, “Is the US Going Broke”, “Can Capitalism Survive” and “The Crash” it takes recent history, from about 1970 and puts it into perspective. As part of the press, Time is of course more interested in bad news than good but the litany of bad news that these covers represent has not presaged the end of capitalism nor stopped the inexorable rise of stock markets.

Legg Mason make some important points in the body of the brochure; investing is for life (or longer if you have children or grandchildren); your long-term goals and objectives are more important than short-term crises; market timing is impossible to get right; invest for the long-term and keep your eyes on the horizon; it is never “different this time”.

Click to read Legg Mason article

Standards International provide an internationally agreed benchmark for a global standard of financial advice. Our systems are rigorously tested over a two day period against the international benchmarks and we are provided with a gap analysis giving us ideas and observations for improvement. At this year’s assessment, the certification was met without any gaps or observations for improvements, which is an incredible achievement.

Michelle Hoskins at Standards International comments:

“It was a pleasure to award Noel Farrelly and Les Phillips of Index Wealth Management their ISO 22222 certificates. They both achieved ISO 22222 certification without any minor non-conformities or observations for improvement. Assessment outcomes like this are very rare and only come after a huge amount of thought and effort has been put into creating a management framework which truly exceeds the reaches of international financial planning best practice.”

Despite our achievement, this is no time to rest on our laurels. We want to continue to demonstrate our commitment and dedication to clients, ethical good practice and professional development. We will constantly review and improve our services so you can be confident that you are dealing with one of the UK’s leading firms that is wholly committed to providing you with the best possible advice, service & support.

Certain commentators never tire of reminding us that gold is a reliable store of value and a safe haven in troubled times. We have been encouraged to buy gold regardless of how high the price has risen, and regardless of the fact that it produces nothing of any value nor any income.

Those who have purchased gold at high prices might want to consider whether it’s worth holding in light of the following quote from Warren Buffett.

 “You could take all the gold that’s ever been mined, and it would fill a cube 67 feet in each direction. For what that’s worth at current gold prices, you could buy all—not some—all of the farmland in the United States. Plus, you could buy 10 Exxon Mobils, plus have $1 trillion of walking-around money. Or you could have a big cube of metal. Which would you take? Which is going to produce more?”

Frank Abagnale’s life story was described in the 2002 film, “Catch Me If You Can“, when Leonardo DiCaprio played the lead; it is a remarkable tale of a 16-year-old, who in a two-year period during the 1960s travelled the USA and Europe whilst impersonating a Pan Am pilot and passing forged cheques with an estimated total value of $2.8 million. He also impersonated a doctor, as well as passing the Louisiana bar exam and practising as a lawyer for a short time.

The film is a celebration of an impossibly glamorous rogue, but a rogue who, nonetheless, gets caught in the end and suffers at the hands of the French and USA judicial systems. Finally, it is a tale of redemption, when Frank is recruited by the FBI to help them combat fraud.

I had the privilege of hearing Frank speak at the FPA in San Diego just last month. He is a spellbinding speaker who confirmed that the film had got much of his life story correct; the audience sat transfixed as he corrected some details and gave us inside information on some of the breathtaking scams he had successfully pulled off. Stephen Spielberg who directed the film has said of him, “Frank was a 21st century genius working within the innocence of the mid ’60s, when people were more trusting than they are now.” Well, that isn’t quite how Frank sees it.

In a finale that wrongfooted many in the audience, including me, he did not glory in that period of his life. In fact he said that there is not a day that goes by that he does not regret it. Those of us from Britain who have been subjected to a long line of 10 a penny criminals queuing up to invite our admiration for their larceny and often vicious crimes found it refreshing that here was somebody who more or less committed what the press likes to describe as “victimless” crimes confessing that he wishes it had never happened. In fact he has made no money from the film, nor from the Broadway play on the same theme.

He had plenty more to say about character, family life and ethics, but for me, his most memorable remark was to contradict the old proverb that “life is short”; to the contrary, for most people life is long and mistakes made when young can have a sometimes devastating effect on your future. His mission is now to get that across to young people with his inspiring message.