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Adviser Profile: Paul Annys of Qi Financial Solutions

Adviser Profile: Paul Annys of Qi Financial Solutions

Rugby coach Paul Annys has avoided any rucks since taking over at Qi Financial Solutions, despite the former owner still being around. Now he is stamping his mark on the firm, appealing to the next generation of clients with his sense of fun.

Father to three young boys, rugby player and coach, a university Masters student, owner of a boisterous Rhodesian ridgeback, and the new landlord of a plot of farmland. Paul Annys is clearly hard at work.

He is on an unbounded mission to better himself, and says ‘rugby gives [him the] control and discipline’ to do so.

But he has not always been so driven. Handing me the personal statement that aided his acceptance onto the MSc course in wealth management he is about to complete, West Croydon-based Qi Financial Solutions’ new managing director ponders whether his thirst for knowledge is a way of compensating for not working hard enough in his youth. He attributes this to the sudden death of his mother and grandparents.

If that is the case, he is certainly making up for lost time. He became a fellow of the Chartered Insurance Institute in 2013. Now, after purchasing the business from a retiring adviser, he is on a mission to rejuvenate Qi.

PAUL ANNYS CV

  • 2013–present Qi Financial Solutions, managing director and IFA
  • 2011–2013 Hamilton Field, IFA
  • 2009–2011 Standard Life, business consultant
  • 2008–2009 Zurich Financial Services, senior consultant
  • 2003–2008 Friends Provident, senior IFA consultant
  • 2000–2003 Haart, senior sales negotiator

PROFESSIONAL MEMBERSHIPS/QUALIFICATIONS

  • Advanced Diploma in Financial Planning
  • Chartered Financial Planner
  • Fellow of the Personal Finance Society
  • Fellow of the Chartered Insurance Institute
  • Member of the Institute of Directors

Tackling the challenge

Annys has benefited from the ‘small world’ notion of the financial planning profession after hearing through the grapevine that Neville Crofts, former director of Qi, was looking to retire.

‘I’d met Neville a few times on my travels at Zurich, so I phoned him up,’ Annys explains. He had been advising for just two years (although he had worked with advisers for eight years in his past life working for providers) when he decided to go it alone.

In 2013 Annys left his practice, City-based Hamilton Field, and gradually took the reins at Qi Financial Solutions. Acknowledging the risk-factor involved, Annys explains why he took the plunge.

‘That feeling of trust was there with Neville,’ he says. ‘I did a lot of due diligence and there were no legacy issues or skeletons in the closet. Everything just fitted: the people, the location and the clients.’

Transitional period

Annys took on half the business initially, to ‘hedge his bets’ and provide some certainty. But in the past two years the firm has come together, with Annys purchasing the remainder in April 2016. Crofts and existing adviser Derek Cooke remain at the firm to help with the transition period.

While the initial plan was for Crofts to retire within one or two years of Annys joining, the setup is working too well for the team to divide just yet.

Four years after Annys joined the firm, Crofts continues to work part time. Annys says having Crofts and Cooke on board fills him with confidence and the clients with trust. ‘There isn’t a finite end date, but that’s not so bad,’ he adds.

FEES

When Annys joined Qi he lowered the initial fee from 3% to remain competitive. The firm now charges a 1% initial fee for most cases, and 1.5% for more complex cases such as pension transfers.

‘We have seen an increase in activity particularly relating to defined benefit enquiries,’ he says. ‘We don’t actively seek them out, but are comfortable offering advice on them where required.’

Ongoing fee charges were typically 0.5%, but he has implemented a segmentation process to increase profitability on smaller cases, while still factoring the risk involved in larger, more complex cases.

Clients with up to £150,000 investable assets are charged an ongoing fee of 0.75%. Those with between £150,000 and £250,000 are charged 0.6%. Clients with £250,000 to £1 million are charged 0.5% and those with £1 million and upwards are charged 0.38%, though the charge for this tier is often determined on a case-by-case basis.

‘Has it been easy?’ says Annys, ‘No. And have I made as much money as I’d have liked to some months? Also no.’ He admits he is a victim of his willingness to help others, attempting to bridge the advice gap and having to remind himself he is running a business.

The firm does not set a minimum investable assets limit for new clients coming on board. But, after calculating a 1% or 1.5% initial charge for smaller cases would not be cost effective, it has set a minimum fee of £2,500 to set up a new client.

Through the phases

Qi’s client bank now combines both Annys’ and the firm’s former clients, resulting in a healthy mix of demographics. At 39, Annys can consider himself a younger financial adviser. He has picked up comparable clients, city professionals for example, through word of mouth. With the majority of the firm’s existing client bank in the pre- or post-retirement phase, the addition of those in the accumulation phase will help with longevity.

Annys says he particularly enjoys scenario planning: plotting out the positive scenarios, while not forgetting to factor in ‘Armageddon planning’ to prepare for the worst.

Crofts now works with a small number of clients and is offered a split on fees for his planning. He wants to continue reducing his workload in the coming months. Annys says a role will remain for him in the business if he wants it.

Annys seeks to perfect the ‘art form’ of investment with in-house offering

Qi Financial Solutions offers five in-house risk-rated model portfolios and five in-house risk-rated multi-asset portfolios for clients with modest investable assets. ‘I’m upskilling on the investment side and we brought in Ross Crake, head of investment research, a year ago to help with the proposition, which is continually progressing,’ says Annys.

‘I don’t think I’ll ever stop trying to progress the investment proposition as it isn’t an exact science, it’s an art form. There are so many variables to keep on top of.’

Qi has moved from using OBSR’s model portfolios to building its own in-house to reduce the costs for clients. The team use research from Financial Express Analytics, which also offers an attitude to risk tool.

Annys wants to keep the proposition flexible to accommodate differing client scenarios, and builds bespoke or ethical portfolios where required. Discretionary fund managers (DFMs) are also used where needed, though he admits he is sceptical about relying on DFMs due to the underlying costs involved.

‘Advisers have access to so much technology and research, and can access what discretionary managers are investing in, without the extra layer of cost,’ he says. ‘It’s a tough job but, if you get it right, it’s the right thing for the client,’ he adds.

‘Over recent years we have dealt with Standard Life Wealth, Rathbones, Brooks Macdonald, Psigma, Investec, JM Finn & Co and Schroders on various levels.’

The firm uses a blended approach, with the majority of clients invested in active funds. These include Lazard’s Global Listed Infrastructure Equity fund, managed by Citywire AA-rated duo John Mulquiney and Warryn Robertson.

This fund was added in 2016, partly on the back of market expectations of the promises made by US president Donald Trump, and due to infrastructure’s defensive characteristics.

Despite Qi’s leaning towards active management, Annys believes factor-based and smart beta investing will become increasingly significant.

Kicking on

We rarely hear about mergers, acquisitions or sales that come without some hurdles, and Qi doesn’t break the pattern. ‘I wouldn’t say it’s been plain sailing,’ says Annys. In the early days, financial decisions were not always easy for Annys due to his and Crofts’ differing long-term plans.

When Annys joined, the pair bought a new office in anticipation of future team growth. ‘But Neville didn’t need five new computers or a boardroom table as he’s retiring!’ says Annys. He said at that time it became important for him to own the whole business to make decisions for the long term.

Despite some furniture feuds, the team dynamic has been collaborative. Annys is now levelling costs at the firm, after a few one-off costs occurred during the transition, as a result of putting new business processes in place.

Eye of the Tigger

Annys is looking to build a business that is honest and fun. He is light-hearted where it matters, quick to admit that he ‘probably messes around more than most bosses do’. But he is sure to get the balance right. ‘Give that great advice, at a competitive fee level, but have fun doing it,’ he says. ‘Otherwise there’s no point.’

The team, which he is actively growing, is also well-balanced. The long-standing Qi team’s experience is complemented by a fresher generation in Vince Hong, the firm’s first graduate. Annys met Hong at Cass Business School during their Masters studies, and was sold on his gracious and hardworking personality.

Annys hopes his energy will continue to rub off on his growing team. ‘They call me Tigger in the office,’ he says with a smile. Qi paraplanner Tracy Sansom’s comment seems to support this: ‘Of all the things I have lost, I miss my mind the most,’ she jokes.

And with that, it seems Annys is well on his way to creating the honest and enthusiastic work culture he desires.

FIVE TOP TIPS

  1. Do what is right for clients, what the regulator wants and make sure you remember the business too.
  2. Work hard, do what you say you will and enjoy working with your team.
  3. Keep learning and you will make more of a difference.
  4. Just say it how it is.
  5. Remaining independent takes time, research and commitment. It is not easy, but it is worth it.

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