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WHO WE ARE.
PAUL MEASURES JAMIE VALE ANNE DUNLOP CLAIRE BROOKS
Legal & General Legal & General Legal & General Suffolk Life
Sales Director,IFA Key Accounts
Director, BusinessDevelopment
Head of PensionDevelopment
Technical Team Manager
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WHAT YOU TOLD US.The changing face of retirement planning solutions
business - % from existing clients.
7%
9%
16%
24%
38%
5%
8%
19%
22%
29%
16%
6%
0% 5% 10% 15% 20% 25% 30% 35% 40%
None - 10%
11-30%
31-50%
51-75%
75% and over
Don't know
Currently
Post RDR
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37%
16%
15%
15%
4%
4%
3%
3%
2%
36%
17%
13%
14%
5%
7%
3%
2%
3%
0% 5% 10% 15% 20% 25% 30% 35% 40%
Competitively priced products
Platform functionality
Range of pre and post retirement product solutions
Speed and quality of administration service
Portfolio Planning tools
Comprehensive MI
Pension Consolidation tools
Accessible sales support
Other
Currently
Post RDR
MOST IMPORTANT PROVIDER SERVICE.
VALUABLE BUSINESS ESSENTIALS.
55%
54%
48%
44%
40%
37%
36%
36%
35%
22%
18%
24%
30%
29%
22%
30%
24%
33%
33%
12%
30%
28%
21%
16%
23%
34%
31%
40%
31%
31%
52%
48%
53%
0% 20% 40% 60% 80% 100%
Investment platforms
Compliance support
Back office systems
Fund groups
Research houses
Specialist SIPP providers
Wraps
Professional connections
Traditional product providers
Discretionary fund managers
Outsourced investment modelling
Currently essential and will remain so Will become more important post RDR Not important
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THREAT OR OPPORTUNITY? • Capital adequacy
• Fees • New income / recurring income • Right level of service for the right price
• Business Model
• Qualification requirements
• Client• Confidence • Financial awareness
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COMMERCIAL CHALLENGE
Typical Revenue from a Commission Based Savings Sale =
£1,400 Initial Charge + £200 pa
Based on average total case size of £40,000 attached a blended average of 3.5% initial + 0.5% trail
L&G’s own research shows 75% of customers expect charges to be less than £100 per hour
More than 50% of advisers expect to charge in excess of £150 per hour
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WORKED EXAMPLE
Relationship Based Advice
Required revenue generation per adviser pa £150,000
Adviser capacity 150 customers per adviser
Sale Conversion Rate N/A
Revenue required per customer £1,000
Revenue generation on Assets Under Advice 65bps (+VAT!)
(based on a charging structure of 0.5% ongoing + 3% initial on new assets equating to 5% of AUA a year)
Required average AUA per customer £154,000
We estimate 1.2 million households in UK with invest able assets above £100,000 of which 600,000 take advice.
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WORKED EXAMPLE
* Note this will need to be achieved with less ‘recycling’ of existing customer assets
** No ongoing service = no ongoing ‘trail’ fee
Relationship Based Advice Transactional
Required revenue generation per adviser pa £150,000 £150,000
Adviser capacity 150 customers per adviser 200
Sale Conversion Rate N/A 66%
Revenue required per customer £1,000 £1,100
Revenue generation on Assets Under Advice 65bps (+VAT!) N/A
(based on a charging structure of 0.5% ongoing + 3% initial on new assets equating to 5% of AUA a year)
Required average AUA per customer £154,000
Transactional Advice Fee 3% (+VAT)**
Required average investment size £ 37,500*
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THE RETIREMENT JOURNEY.
WEALTH ACCUMULATION PHASE
WEALTH DE-ACCUMULATION PHASE
RetirementStart working
Starting out
Retirement options
Asset building
De-risk and asset transfer
Assets £
HOW THINGS MAY CHANGE.
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WEALTH ACCUMULATION PHASE
WEALTH DE-ACCUMULATION PHASE
RetirementStart working
Starting out
Retirement options
Asset building
De-risk and asset transfer
Assets £
Debt management
Consolidation opportunities
Generation transfer (IHT)
Income strategy
TAX PLANNING
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SOLUTIONS.BUSINESS AREA HOW WE MAY BE ABLE TO HELP
COST AND VALUE
Explaining the value of your service
Succeed in difficult times
Placing a value on your time
REVENUE AND EQUITY
Getting the most of your existing clients
Targeting clients to increase revenue streams
Developing effective professional connections
Maximising business value
RISKS AND STRATEGIES
Building TCF principles into your work
Planning business succession
Identifying your client propositions
Influencing business change
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THANK YOU FOR YOUR TIME.
We’d be please to speak to you in greater detail about Retirement Planning and Business Solutions with Legal & General so please come and see us during lunch or give us your details and we’ll get in touch.
We’d like to invite you to enter our prize draw to win a case of wine!
To enter please place your business card in the dish near the exit.
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CONSOLIDATION. Millions perhaps billions of pounds in pension assets in poorly performing , high charging or restrictive pension plans.
The benefits• Better control over pension assets• Broad investment choice, flexibility and control• Single portfolio • MI, administration, economies of scale• Balance of assets• Act against risks• More informed choice as retirement approaches