Bringing expectations and reality into line

Five points for people with 30 seconds to spare

1. After 15 years working on a commission-based model, I changed course. Not for moral reasons, but because I couldn’t keep my own service promise.
2. The problem was structural, not personal. If you’re not constantly selling new products, you don’t earn anything. If you’re constantly selling, at some point you can no longer provide proper support to anyone.
3. For me, financial advice consists of three distinct tasks. Analysis and advice, intermediary services, and client support. Each requires a fee structure that suits it.
4. I do not accept commissions on investments or retirement provisions. Over the lifetime of a client relationship, this amounts to four- to five-figure sums that remain with the client.
5. How you can judge me is set out at the end of this post.

The long version, perfect for one or two cups of coffee.

What no longer fits

Over the past 15 years, my career has been built on a remuneration model based on commissions. This fact has consequences that have nothing to do with individual people; they are structurally determined.

Anyone who looks after clients in such a model without constantly seeking new business will not make any money. Anyone who is constantly seeking new business builds up a client base which, sooner or later, they will no longer be able to look after properly. This is a vicious circle in which one must either commit to new business or prioritise one’s own standards of service.

My new business will be geared towards the second approach in future. Under the old system, I was unable to fulfil every commitment to my own satisfaction. I worked hard, but my own service promise fell by the wayside. This was a systemic problem, not a personal one.

What has changed

In recent years, I have been unable to achieve what I had set out to do, which would have been in keeping with my self-image. This was not due to a lack of intention, but rather to a system in which I was unable to achieve what I wanted. My aspirations and reality have drifted apart.

Nine months ago, I made a decision without knowing where it would lead me. I have used this time to lay a solid foundation and to prepare a new approach thoroughly. This has resulted in something that builds on what is all too often neglected in this sector: a system for client relationships that embodies a genuine understanding of the client, regards support and service as integral components, and cultivates a close relationship as a matter of course.

I have learnt what uncertainty means. This experience has given me a solid foundation. Anyone wishing to work with me today will find an adviser who understands uncertainty from personal experience. I do not wish to continue grappling with the conflict between aspiration and reality. That is why I am now taking a different path.

What the new world looks like

In my view, financial advice comprises three separate, distinct tasks:

1. Analysis and Advice

2. Sale of products

3. Client Support

Each of these tasks requires a remuneration model that suits its nature. That is the crux of the structural changes currently taking place in my work.

In the areas of investment and retirement provision, I deliberately do not accept commissions. I charge my fee based on the time and expertise involved, never on the basis of lost commissions. For clients, this translates into savings in the four- and five-figure range over the course of an average client relationship.

In other areas, such as traditional property insurance or products for which there is no fee-based option, I remain within the commission-based model. Not out of convenience, but because a fee-based arrangement is not feasible in these cases. However, anyone wishing to cover all financial matters from a single source cannot afford to overlook certain product areas simply because the remuneration does not fit the ideal model. Pragmatism is part of our ethos here.

My Service Concept is a distinct element within this model. It is unique in its overall structure and design, places the client at the centre and delivers something that traditional financial advice does not offer in this form. Further details will follow in subsequent posts over the coming weeks and months. Anyone who is interested and would like to find out more now is welcome to book an initial consultation with me.

The vision I have for the service as a whole is that of a ‘small family office’. All financial matters from a single source, without you having to meet traditional minimum requirements. How this works in detail will also be the subject of further posts over the coming weeks.

How you can judge me

Four promises you can check out.

1. There are no commissions on investments or retirement provision. My fee is based on the time and expertise involved, never on any commission I might forgo.
2. Analysis, brokerage and support each have their own price, which you will know in advance. No quote without a figure, no figure after the consultation.
3. Support is an integral part of the service, not an afterthought. You’ll hear from me without needing a new contract as the reason.
4. I’ll tell you my opinion, even if it hurts. And I’ll tell you if there’s something I don’t know.

If you think I’ve gone back on my word on any of these points, please let me know. That’s exactly what they’re here for.

What this means for you

I look forward to working with anyone who would like to collaborate with me in the future.

If this is the first time you’re reading my work, this post will give you an honest insight into how I work and what I stand for. If this appeals to you, I look forward to speaking with you. If you’re still unsure, you’ll at least have a clear idea of what sets my work apart from that of other service providers.

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Thank you

Taking the step described was not easy. I had to decide and carry it out myself. However, it was possible thanks to some special people in my life, to whom I would like to express my heartfelt thanks.

First and foremost, to my wife Kira, who has given me indescribable emotional support from day one. When I was feeling down and had my doubts, she was always by my side and reassured me that I, and therefore we, as equals in a partnership, should follow this path.

Also, to Sebastian. Following the biggest disappointment of the past ten years, you gave me, 48 hours later, courage, a mandate and a clear vision. I thank you for your honesty, the open dialogue and the trusting partnership.

On the client side, I would like to thank Daniel and Lars. You have sometimes shown me, in a tough but mostly respectful manner, where I have changed and when, unfortunately, it was not for the better. I thank you for giving me the crucial impetus to build this system for future business relationships and clients.

And finally, I’d like to thank you, Thomas. We met shortly after I’d made the decision to strike out on a new path. You gave me a good telling-off once, but afterwards you showed me ways in which I could turn many of the things I’d viewed critically into something positive.