When Jason McGuigan first started working in financial advice 20 years ago, he never thought he would end up the chief executive of what has been a top 60 accountancy firm.
But in June this year, he was promoted to the top position at Oxford-based Critchleys from his previous role as partner of the firm’s financial planning arm.
JASON MCGUIGAN CV
- 2017–present Critchleys, chief executive
- 2007–present Critchleys Financial Planning, partner
- 1997–2007 Critchleys Chartered Accountants, director of financial planning
- 1995–1997 Abbey National, financial adviser/insurance development manager
- 1988–1995 Self-employed financial consultant
Financial Planning Certificate
Advanced FPC G60, G10, G20, Full AFPC
Certificate in Mortgage Advice and Practice
Certified Financial Planner
RO1, RO2, R08
- Chartered Financial Planner
McGuigan last appeared on New Model Adviser®’s cover in 2008. The firm had only recently got onto an even keel after a bumpy start trying to change the culture of the accountancy practice. Back then he was fighting for a fee-based model, before the retail distribution review (RDR) made that mandatory, in 2013. Fast forward to 2017 and, in what some might say was a very post-RDR sign of the times, he has made the move into restricted advice.
For McGuigan, becoming chief executive represents a shift in thinking at the firm. ‘It goes to show how important my partners realised financial planning is within an accountancy practice and the fact clients do want and need it as part of the service,’ he says.
McGuigan says the firm’s fee structure has not changed since New Model Adviser® last profiled Critchleys in 2008. It typically charges between £2,000 and £5,000 for a financial plan, depending on the complexity, a 1% fee for implementation of that plan, and a 0.75% annual retainer for ongoing service. There is also a fixed fee for non-regulated advice, for example if the work requires bringing in a lawyer.
For this clients with more than £200,000 with the firm typically receive an annual review, although there is a lower-touch service – access via email or telephone – should clients prefer this.
For clients with more than £700,000, Critchleys offers a ‘diamond service’, which integrates tax advice, financial planning, consultancy and compliance. ‘We’ll do clients’ tax returns for them as part of this service and they love that,’ McGuigan says.
In his new role, McGuigan is tasked with integrating wealth management, financial planning, accountancy and tax planning into one multidisciplinary service. He likens this process to a car, in which he is now the driver.
Accountancy is generally akin to the rear-view mirror, looking back at the previous year’s tax returns and accounts; and the interior, the here and now of current tax queries. But looking through the windscreen along the road into the future are the financial planners.
‘Historically, accountancy firms need to develop their skills further in forward planning. That’s where accountants and financial planners working together is really important,’ he says.
Critchleys offers clients access to multi-manager portfolios with passive preference
As a restricted firm, Critchleys uses the Intrinsic network’s best of breed range. This includes the Old Mutual Cirilium portfolio range, managed by Paul Craig. Top holdings in the Moderate portfolio include the Miton UK Value Opportunities fund in equities, the CZ Absolute Return Alpha fund in alternatives and the Ashmore Emerging Markets Short Duration fund in cash and fixed interest. It has outperformed the IA Mixed Investment 40%-85% Shares benchmark over the past two years.
In the Intrinsic matrix, Critchleys clients have access to both multi-manager active and multi-manager passive portfolios. McGuigan’s personal preference is for passive. He says that, over the 20-year period he has been observing the markets, it has been hard to find an active manager who can consistently outperform. The difference in price is also a factor, around 0.6% he says, which can mean clients tend to seek out a passive option.
Similarly, he believes good returns come from asset allocation, rather than picking particular funds. For example, considering whether to be in China or the UK rather than whether to invest in BP or Shell. ‘You can have an asset allocated passive strategy with someone overseeing where in the world you need to invest but then getting cheap trackers,’ he says. ‘That will do the job.’
Long road of innovation
McGuigan has an interest in cars and the Mini he is photographed with in this shoot belongs to his daughter Jessica. She also works at Critchleys and is training to be an adviser. Oxford’s history is inexorably tied with the Mini. In 1913 young cycling enthusiast William Morris established a production plant in the city, which would go on to roll out the first classic Mini in 1959. Since then the iconic car, and the plant itself, have gone through several reinventions and innovations.
Since it was set up in Oxford in 1906, Critchleys has also seen a series of redevelopments. In the past 12 months, the firm’s 120 staff have moved offices to a building near the city’s main train station. A new website has also been launched, with the help of Oxford digital marketing agency Syndicut.
‘The website is all about personas now,’ McGuigan says. ‘Instead of seeing products and services, you now see: "I am a business client, I am a private client, I am a charity client" and you can see the journey you will go on, whether it combines tax, wealth management, financial planning and so on.’
The firm has also launched the Critchleys Conversation, a short weekly audio recording posted online. This is easier to produce and more engaging than a blog, McGuigan says. It features interviews with experts from the company and, he hopes, experts from outside the firm in the future. ‘One we did recently that had a lot of hits explained what a director’s loan is and how it works,’ McGuigan says.
Perhaps the biggest change at Critchleys, and the most controversial, was the decision last year to become a restricted firm. Critchleys now uses network Intrinsic’s best-of-breed solutions. McGuigan says this includes managers such as Old Mutual Wealth and Seven Investment Management (7IM), the latter of which Critchleys had already worked closely with for the past 10 years.
‘It might be a radical thing to say but I don’t think the independent badge is as important as it used to be,’ McGuigan says. ‘What clients are looking for more now is trusted adviser relationships and qualifications.
‘And if I’m honest, if you actually look at how many independent firms manage their affairs, are they really independent?’
McGuigan says justification for the decision is twofold. It frees up his time by removing regulatory red tape, which incurs additional costs that have to be passed on to clients. It also brings down regulatory fees.
‘For the past three to five years, our regulatory fees have gone through the roof and we had no control over it,’ he says. ‘We had to make a decision: do we want to skill up and perhaps offload these costs onto our clients? Or do we find an alternative solution? To us, a network solved that problem.’
The decision was not taken lightly. McGuigan says a ‘restricted plus’ classification from Intrinsic allows him to access whole-of-market solutions for clients, particularly wealthy clients, who need a more specialised approach. He adds: ‘After being an IFA for 20 years, there’s no denying that the thought of moving away into a more restricted way of doing things contained an element of fear of the unknown. How would clients react? But having done it, we haven’t found it an issue at all.’
He says using cashflow modelling as part of the firm’s core proposition is an empowering experience for clients. He says cashflow and lifestyle discussions, which serve to build trust, are more important than the product that emerges at the end of that process.
With a simpler approach, McGuigan has more time for his clients, although his new role is likely to change this. He says he will start to hand over his 100-strong client book over time but the financial planning team has remained quite small: three advisers and four support staff. This includes his most recent hire, and first female adviser, Hatice Cinkaya, who joined around three months ago. The difference in the number of ‘active’ and other clients listed [see box, right] is a number of ‘non-engaged’ clients picked up from group personal pension schemes Critchleys set up.
To fuel his multidisciplinary approach, McGuigan encourages communication between this team and the accountancy and tax teams. This comes in the form of joint meetings with clients, as well as social events, such as bowling at Oxford United’s Kassam Stadium and a trip to Newbury races earlier this summer. On the Friday before Halloween, fancy dress was encouraged, with a financial penalty for those who came to the office in business attire. The money raised from this and other fundraisers goes towards Critchleys’ charity of the year, Oxfordshire’s Alzheimer’s Society.
This integration is key to McGuigan’s plans for the next 10 years. ‘From a financial planning perspective I want to continue doing what we do,’ he says. ‘We’ve got a good thing going, clients like it, but the key focus now with my bigger hat on is to fully integrate financial planning into the wider accountancy firm.’
Now in the driving seat at Critchleys, McGuigan says: ‘We are in control of the financial road map.’
FIVE TOP TIPS
Put the client at the heart of your business proposition.
Do not ask your team to do something you would not be willing to do yourself.
Build a team that get it, want it and have the desire to make it happen.
Always make decisions that are in the interest of the business, not individuals.
Be patient with your professional connections; they can come good.