Life is hard. Constant happiness is not a normal state of affairs. "When we change the words 'have to' to 'get to' we stop dressing up opportunities as stress." Gratitude is pathway to introducing happiness to a situation. "If you can't find a helper, it's your responsibility to become one."
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Brent has dozens of true-life stories and anecdotes about ordinary South Africans whose decisions to do something for someone else or their community has had a significant impact. Knowing other people's stories can give us a sense of perspective about our own problems.
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Lessons on how to cut through the noise of news. Be purposeful and passionate about what you do. There always three sides to a story. In journalism, there are 100 sides to a story. Notice how the narrative changes after a story first breaks. When something bad happens - the helpers will show up. One thing can change everything. You need to know the bad news. Without knowing what's going on around you, you won't know what needs to be fixed. One story by Brent led News24 to start covering more good news stories. What you do makes a difference. You have to decide what sort of difference you want to make.
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"Social media only matters if you are using it to do good." Every person has an incredible story to tell. All you have to do is want to listen to it. Good Things Guy website has about 2 million readers a month.
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Topic: The Good Things Guys - Changing the Narrative
The last speaker of the convention is Brent Lindeque, motivational speaker, journalist, and social media influencer. Here is his website: Good Things Guy https://www.goodthingsguy.com/ Brent relates a number of (true) stories that show there is another side to SA than all the bad news and negativity. That other or counter narrative is out there, but it can be difficult to find. There are stories of ordinary people engaged in extraordinary acts of kindness.
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Walk for 10 to 15 minutes after the last meal of the evening. Drink a bulletproof coffee to prolong fasting. Eat a leafy green salad with a lot of vinegar before eating a starchy meal to reduce the sugar intake.
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Holistic mental health 1. Maintain mental focus and clarity. 2. Practise mindfulness. 3. Have the right mindset. Low- to no-cost interventions: Have a glass of warm lemon water first thing in the morning. A lot of dehydration takes place during the night. Write down your intentions for the day. You can mindful of achieving those intentions. Your mindset will stay in line with your goals. Early morning sunlight. Start moving before you start eating or start working. Prioritise protein. It is important for building and sustaining muscle. Eat enough clean fats - olive oils, seeds; stay away from transfats. Eat plenty of leafy vegetables. Take your essential vitamins: D3, K2, B vitamins, vitamin C.
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Holistic fitness 4 areas: 1. Strength We need to retain lean muscle mass, particularly as we get older. 2. Aerobic exercises (Zone II) Should be done two or three times a week. 3. Anaerobic exercises Interval training Once or twice a week for about 20 minutes. As you get fitter, it become high-intensity training of about 4 to 10 minutes. 4. Body structure Have regular massages, or do Pilates or fascia training. Do range of motion exercises to maintain subtleness.
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You can be healthy without being fit. You can be fit without being healthy. If you are fit and healthy, you are safeguarded against chronic illnesses. Holistic health Metabolic health - 4 measures: Blood pressure Blood sugar Waist circumference HDL cholesterol If your metabolic health is compromised, you are a candidate for diabetes, heart attack, dementia. Arterial health How do you test for arterial health? Lipoprotein profile - specifically your VLDL Calcium levels - use vitamins including K2 to remove calcium from the arteries. Microbiome Need to eat leafy green vegetables. Inflammation markers Inflammation is a driver of illnesses.
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Topic: Holistic Health for a Financial Planner
The speaker is health and fitness coach Joep Loots. Joep tells the audience we have something in common: we are both coaches. Two things are important to you: time. Health can be neglected because of time constraints. Second, whatever you do must be functional. Planning is important for fitness - know what you need to do during the time allocated to your routine. You need to do an assessment - where are you now. Set goals - what you want to achieve and how you want to achieve it. Have measurable goals. Action plan - why do you want to change. A fitness plan must be simple to understand. It must be easy to do. It must enjoyable to follow.
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The contract of employment imposes a duty on the employee to uphold the reputation of the employer. Airing your employer's dirty laundry violates this principle. Emma has finished. It's time for a break.
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Cases involving WhatsApp groups are coming to the fore. If you are using WhatsApp groups for business, it is recommended you have guidelines for the group. In terms of RICA, you can record or intercept any message to which you are a party. But you can't record a conversation to which you are not a party, unless someone is using your (as the employer) work-issued hardware or software.
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Industry regulations/guidelines/codes apply in the online world. Some people by default over-document their lives - posting content can inadvertently breach confidentiality and non-disclosure provisions. The main lesson is: do not bring your company or employer into disrepute, and do not bad-mouth your company or employer. There is no wall between the personal sphere and the employment sphere. The billboard test Ask this question: what you want to post on social media - would you be happy to publish it on a billboard on the freeway with a photo of you and your name and the name of your employer?
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If someone posts something negative about you or your company, should you always respond? Take note of the Streisand Effect. Responding can fuel the flames and result in something going viral, whereas it was previously seen by only a few people. So, the first question is: how much traction is this getting? Second question: is there any truth to the allegations? Even if the law is on your side, sometimes the practicalities outweigh the legal side.
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Reputational risk posed by every employer to an organisation. If someone messes up, the first thing that happens is pressure is put on the company. If behaviour causes reputational risk to a company, there is no question that disciplinary action can be taken. By law, if you ask someone to take down an image of you, they must do so, unless the image shows you doing something illegal - then your privacy rights fall away.
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In Emma's view if you have the ability to dissociate yourself from illegal content and you do not, you are equally liable for the content. Even "liking" something can constitute publication.
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Every single person in the chain of publication something illegal is responsible for it. If you don't delete something illegal posted on your page/group/ profile that you are aware of, you can held liable for it. Admins are responsible for what is published on a WhatsApp group. If you are a member of a WhatsApp group and you are aware of something illegal or defamatory, it is advised that you remove yourself from the group, or you could be "guilty by association".
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Under the Cybercrimes Act, you can be prosecuted for inciting violence. Sextortion is a big issue in her practice. Either intimate images are solicited or deep fake images are created and people are blackmailed. The legal consequences (defamation) of what you publish in mass media and what you publish in a WhatsApp group are the same.
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Topic: Back to the future and social media
The next speaker is Emma Sadleir, founder of the Digital Law Company. The biggest impact of AI in her line of work is deep fake technology - the creation of fake images. It's almost impossible to see they are not real images. War in the Middle East is creating a dilemma for companies - can they prevent employees from displaying their support on social media? Many cases from around the world have established that a legal contract can be concluded by using an emoji.
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The future is bright for financial advisers who embrace technology while maintaining a strong human connection.
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Technology can be used to create an appetite among clients for human-augmented advice.
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Technology will create more time for advisers to have more conversations that bring meaning to clients' lives. Liberty has partnered with Standard Bank. The bank has daily conversations with clients - data about transactions. One can see, for example, based on behavioural data whether a client is expecting a baby. This can be used in conversations with clients when planning for the future - preparation for what lies ahead.
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Topic: Back to the Future through Human-augmented Advice
The after-lunch speaker is Bongani Khulu: executive: OmniChannel and Bancassurance at Liberty. Bongani emphasises the need to build trust - clients are looking for someone they can trust. Advisers are concerned that technology is barrier to building trust between advisers and clients. Bongani refers to Charles Green's book, The Trusted Advisor, to discuss "the trust equation". What clients are looking for is someone who understands their concerns holistically - their history and how they behave now - not just an adviser who understands their financial situation. Bots do not have the human "sixth sense" - the adviser's ability to detect there is something the client is not telling them.
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Succession planning needs to be done carefully. It must take into account the interest of the clients. Future proofing your business requires having a clear value proposition. Protect data and take cyber security seriously - not only to protect against criminals but also to maintain confidentiality. What skills will be required in future? Integrity and fairness Objectivity and being a good listener Agility and adaptability Be a lifelong learner Be professional not only in business career but personally - is your behaviour or profile consistent across all areas of your life? Have boundaries You can't look after your clients if you don't look after yourself. Clients need to take ownership of their plans.
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Longevity is a challenge. Need for a second career post retirement. Issue of parental care, particularly if the children have left the country. Need to monitor when clients are showing signs they can no longer look after themselves and make provision for it. Gen Z clients have different priorities and life goals. She addresses investment return challenges. More volatility Clients want more certainty - moving to money market funds. Clients need to get into the market for long term growth. Risk profiling. We can place too much reliance on what clients tell us about their risk tolerance. Clients need to be made aware of the big risk of not taking on risk in growth assets. She addresses inequality and unemployment. This is big risk facing SA. We need to do what we can in our spaces. Look for opportunities to get involved in financial education and literacy - pro bono work. Self-employment is a reality. Our plans must be flexible to take account of variable income and employment.
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Challenges facing planners: Short attention spans Information overload Instant gratification Fatalism about the future, particularly after Covid Clients need to find meaning in their life. If not, they won't commit to the long term. Many clients have children offshore - need to for cross-border planning. We need to be aware of our own sentiment crowding our decisions on the right offshore/onshore allocation. We need to be objective. If we are working with clients offshore, we need to be aware of offshore regulatory obligations.
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FPI 2023 Financial Planner of the Year - Lara Warburton
Lara Warburton was announced last night as the Financial Planner of the Year for 2023. Lara is managing director of Integral Wealth Management. We need to leverage technology but let's no lose sight of personalised advice. Our value lies in selling advice, not products.
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The final talking point is enabling sustainable financial outcomes. FSCA has asked itself how it can promote sustainable finance. These area: Facilitate capital flows to new entrants. Make it easier for market players to conduct due diligence. There is lack of understanding about what is meant by sustainable finance. How do you assess whether a product is sustainable? Work around customer conduct issues around sustainable finance is in its early stages. FSCA earlier this year published a discussion document setting out 5 pillars of sustainable finance: https://www.fsca.co.za/Regulatory%20Frameworks/Temp/FSCA%20sustainable%20finance%20statement%20Final%20March%202023.pdf FSCA still at the early stages of understanding its role in sustainable finance. We will engage with industry organisations to find out what the challenges are in the industry and for customers.
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Focus area for FSCA is how FSPs are factoring in cost of living crisis when designing products and deciding on remuneration models. Assessing value for money for consumers. Another supervisory focus is the extent which institutions are mitigating the risk of internal fraud.
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The second talking point is what this means for the FSCA. We need to address the fragmentary regulatory framework in SA. She refers to the FSCA's latest three-year regulation plan, which outlines to key regulatory focus areas. The plan itself signifies the shift in planning to relevance. This year's document is a rolling three-year plan. One of the key themes, which we expect the industry to focus on, is culture and governance. Who is taking responsibility for product design? This can't just be parcelled out to compliance and legal. She highlights the importance of IT resilience and governance. This is a systemic issue. And the draft standard on consumer education. FSCA has established a consumer advisory committee, made up of external individuals. The panel is to guide the FSCA on the relevance and impact of its consumer education initiatives. Another area is Open Finance - an opportunity to open up the sector through innovation. Crypto assets - more relevant with greylisting because FATF says SA's framework for dealing with AML risk involving crypto needs to be beefed up. Reminder: two weeks to obtain a crypto licence. The FSCA will take "stringent action" against providers that should have applied for a licence. FSCA is assisting with getting SA off the grey list. FATF indicated that we have made good progress on 14 action items. More needs to be done on prosecutions. FSCA has been doing a lot of work to increase our breadth and depth of capacity to supervise AML risks. FATF says FSCA needs to have stronger enforcement and sanctioning. The intensity of our supervision will be increasing. Our first priority, however, is not enforcement but creating awareness of the regulatory expectations.
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There is more regulatory convergence around the world around key common themes. Regulators need to move away from regulation as a compliance exercise to regulation as a strategic exercise. What are the goals we want to achieve in our financial sector? What are the challenges we want to overcome?
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Topic: FSCA Regulatory Update
The speaker is Farzana Badat, the deputy commissioner at the FSCA. Her first talking point is the evolving role of regulation in SA and around the world. What is the role of the regulator in the future? They must remain relevant and have an impact. Globally, regulators are moving away from their traditional role of managing risk. They are also promoting innovation. They must protect society. She addresses the many factors that driving regulators to change globally. These include: Lessons from the pandemic. Frequency of natural disasters. Global energy crisis. High inflation and interest rates - growing number of vulnerable clients. The cost of living crisis. And in SA we have additional challenges: Load shedding a national grid failure concerns. Impacts of greylisting.
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The conversation shifts to how online games can educate children about financial planning. Gareth: AI makes sense as a way to reach a broad audience. Let's get young planners involved in designing tools. We need to make distinction between "just in time" advice and long-term, in-depth planning. The panel discussion has ended.
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Anne: Corporates can provide umbrella employee benefit funds, not just retirement funds. An overarching approach will provide an opportunity for advisers to be involved in every aspect of a person's finances. Gareth: Retirement fund advisers have a responsibility to the members. Kobus: AI and other technology can free up time for advisers/planners to do pro bono volunteer work and provide mentorships. The will enable the industry to reach far more people. Tech shouldn't be only to serve our exiting base but to expand to reach those who need advice. Anne: What works when it comes to financial literacy? Courses don't have much of an impact. But technology enables us to intervene when someone needs a product or service. Tech can enable to us model the outcome of different options a client may choose.
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Gareth is asked about how Crue tackles financial education. Gareth: We provide advice to pension and provident funds. We plug into organisations with which we can partner to add financial education as part of their initiatives. At Crue, it is driven by social responsibility. We use mass platforms, such as YouTube, to share information. AI might enable us to do this at scale. Financial planning is a relatively young profession. It's great that many young people aspire to enter the profession. He agrees that a salaried approach would be better than commission for new entrants, so the focus is on the advice, not the product.
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Nicci: Brings the conversation round to who pays. How do we incentivize people to provide planning those who can't afford it? Kobus: He returns to the internship. Interns start with low and middle income earners, not high earners. The intern's remuneration is part of corporate social responsibility. But we need more advisers in the industry to meet the need. The corporates should support the future of the profession. Anne: Why have we segregated the market? Everyone, irrespective of income, needs financial advice. Compensation should not be linked to wealth. Making people financially capable will have more of an impact on the country than getting people to save for retirement.
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Can we follow someone from when they enter the retirement fund? Broaden the focus to encompass debt and assets. Financial planning should follow someone throughout their journey, not just at the end when someone buys an annuity. Jackie: Imagine if planners could talk into the families of employees. Anne: Holistic financial planning recognises their are multi-generations involved.
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Nicci: How do we meet the needs of the middle income group? Kobus: We need to bring in young planners. He proposes there is an intern system, as with doctors or lawyers. Bring in an intern who can learn under supervision. They should be paid a salary, not commission-based remuneration. The opportunity to learn will overcome the high failure rate in the industry because of lack of support. Jackie: She likes the idea of internships. Some students get into the wrong business model and they fall out of the industry. We need to bridge the gap between technical/university and what is required to work in the industry and deal with clients every day. Anne: Across the industry, many positive steps have been taken, but we are not connecting the dots. What is financial planning? It's guiding someone on what to do with their first pay cheque. Where do we find that? In the retirement fund. A retirement fund takes part of an employee's income and uses it for retirement saving.
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Anne: SA needs a financially stable middle class. We need to make distinction between financial advice and financial planning. Nicci: Business models and remuneration models are barriers to getting the industry to administer advice effectively to everybody. She turns to the issue of remuneration. Gareth: Many people into planning and then we jump down to bottom end of the market (who need financial literacy), but the people in the middle who need financial advice are left out. He raises the issue of whether commission should be upfront or ongoing. Commission should led to long-term engagement and appropriate advice.
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Topic: Can SA make the great shift? Why financial planning needs to go holistic
The after-break sessions are panel discussions. One of the sessions is on the new financial planning standards. The panel members are: Kobus Steyn, tax and fiduciary practitioner at Kainos Wealth. Anne Cabot-Alletzhauser, practice director and co-founder of the Responsible Finance Initiative at the Gordon Institute of Business Science. Gareth Collier, director of Crue Invest. Jackie Palframan, financial planning consultant and senior lecturer at Nelson Mandela University. The moderator is Nicci Macdonald, HOD: certification and standards at the FPI. First question to the panel is: how do we make financial accessible?
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Question: Is the IEC truly independent? Will the elections be rigged? Answer: I am confident the IEC is independent and the 2024 elections will be free fair. We can rely on the courts to deal impartially with any issues. Mandy Weiner's presentation has ended. It is time for the break.
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Question from the floor: Are there any young talented people in the civil service driving hope for change? Answer: Weiner says she does see talented young people coming in but not enough. But the general problem is attracting people into the public sector when they can choose more comfortable and better-paying jobs in the private sector.
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Question from floor: Isn't the risk of private-public partnerships alleviating the state of doing what it should be doing; it is removing accountability. Answer The view from the private sector is that it cannot simply sit back and do nothing. Government is not going to tell the private sector where to put its money. Weiner acknowledges the risk of letting the government off the hook. But what is the alterative? Just letting things crumble?
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Question from the floor. There is an "elephant in the room" - the groundswell of unhappiness among many people about illegal immigrants. Answer Weiner says she realises her position is unpopular - we need to avoid xenophobia and have humanity. It's a fine balance because the influx of immigrants through our porous borders is a problem.
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Question from the floor about advice for whistleblowers. Answer: Obtain legal advice the protections that you do have. Understand the very real risks. She advises approaching The Whistleblower House https://whistleblowerhouse.org/
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She cites research by the Brenthurst Foundation, which puts ANC at 41%. Weiner thinks this is too low. One of the scenarios for post-election SA is ANC-EFF coalition. The other scenario is more centrist, where the ANC shares power with parties such as the DA. The point is that there is hope; there are options. She comes to her original point that we ride an emotional rollercoaster. Weiner brings this round to financial planning: pay attention to what you as a planner read and what you tell your clients, and what you share on social media. She encourages everything to register to vote and to vote. Get involved in your community and support NGOs. "I believe that SA is worth fighting for."
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So, what next for SA? The election next year is the context. We are in the era of coalition governments. The horse-trading at municipal level is hitting service delivery.
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She highlights public-private partnerships. "Stuff is getting done." There is good collaboration between the state and the private sector in the areas of logistics and combating crime.
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Weiner speaks about those ordinary people who instead of just complaining are getting things done. This also applies to people in the informal economy, who look for and create opportunities.
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And then there are the whistleblowers - without them we would not know about much of the corruption. These people often pay a high price for blowing the whistle. They often can't find jobs. They are seen as "informers". In the worst case scenario, whistleblowers are killed - the example of Babita Deokaran who was gunned down in her driveway for exposing corruption at Tembisa Hospital. Wiener says whistleblowers should be protected and encouraged. We will not win the fight against corruption unless whistleblowers are protected.
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We should not overlook the important role played by investigative journalists in exposing corruption. SA has a wide measure of freedom of speech, which enables us to how power to account.
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Let's not forget the "unsung heroes" - the civil servants who go to work and do their jobs; who aren't lazy; who don't sign off on tenders; and who blow the whistle on corruption. These people can pay a high price for pushing back.
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The rule of law is still largely intact. We are not living in a state of anarchy. SA has an incredible constitution. Everyone wants convictions for corruption. We shouldn't forget that the NPA was a primary site of state capture. There is a concerted effort to rebuild and create human capacity in the NPA. State capture prosecutions take time. They are starting to happen.
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SA has an incredibly strong civil society. These organisations have held the line and stepped in when government and state institutions have failed. She encourages the audience to support civil society financially.
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People are tired of being fed hope. There is resilience fatigue. The one story we have about SA is that government has failed and nothing works. The problem is that we forget about the other stories about SA. "I like to focus on the hope dealers" - people who are doing their job, people who are changing the narrative, those who are battling corruption, and who trying to make things work. On the other hand, there are the opportunists and trough-feeders. The stories about the people who are trying to make things better are not told often enough.
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Fear can blind people to the reality. People don't always trust the media. Edelman Trust Barometer shows declining trust in government and the media. But the public - and financial planners' clients - have more trust in business. The media has a negativity bias - the bad news predominates. The media lacks balance. It needs to tell the good news stories. We need perspective.
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But it's important to understand what we have through over the past decade - state capture. The scale of the project was astonishing. Daily Maverick put the cost of state capture at R1.5 trillion. State capture shredded many of our institutions. This was compounded by Covid and Covid tender corruption. The KZN floods and greylisting have compounded the problems.
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Organised crime is a concern - the mafias operating in various sectors, such as construction. There has been an alarming increase in targeted assassinations. This type of crime is filtering through into legitimate business (hit on Cloete Murray).
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It's easy to fall into the narrative that SA is a "failed state", which we are not. But the economic stats are not good: widespread poverty, high unemployment, low GDP. And then there's load shedding, although there has been a reprieve recently. Service delivery is poor, and many municipalities are dysfunctional. Water cuts are becoming an issue.
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She asks the audience how they are feeling about the state of the country and the news cycle. The question elicits a variety of responses, negative and positive. In SA, we ride a rollercoaster of emotions - highs (the Boks win) and lows (stage 6 load shedding). Weiner says she has done a front-row seat to history for nearly two decades. We as SAfricans tend to think that everything is worse here than it is everywhere else. It's important that we have a sense of perspective of how things are in SA.
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Topic: The Fight for South Africa. Speaker: Mandy Wiener, journalist and author.
The first main speaker of the day is award-winning journalist Mandy Wiener.
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What should young advisers do to thrive in the industry? Write your own story (not just your own cheque). Have systems and processes - think: what is my perfect day, what is my perfect week, what is my perfect year? Embrace social media - build relationships and connect with people around common interests and hobbies. Some people are afraid to embrace social because they think they have to become someone they are not. This is not true. Don't be afraid of "no". Seek mentors and guidance. Embrace AI. Be confident. Confidence is built by doing (practice). Ask for testimonials from your clients. Testimonials are the quickest way to show that you have done something for someone. Ask them to answer specific questions when providing a testimonial, so there is specific evidence of what you have done.
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We don't tell our success stories - how has your planning benefited someone? Because we don't tell of our successes (the impact of your advice), people think the industry is just about pushing a product.
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Good financial planners not only need to be technically proficient, but also have good communication and relationship-building skills. We need to emphasise to young planners the huge impact that financial planning can have on people's lives - not only financially.
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It is important to encourage more young people to come into the financial planning industry for it to be sustainable. It's a tough industry, so ways should be found for young people to survive and thrive.
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But there are barriers - apart from financial difficulties. There is a misconception that one has to be rich to save and invest. Similarly, the perception is that financial planning is only for the well-off. Mapalo provides examples of the impact that good financial planning can have on people's lives.
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The last speaker for the day is Mapalo Makhu, founder of Woman & Finance, who speaks about the myths around financial planning. She addresses myths around saving and investing. One of these myths is that women do not want to save and invest.
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He moves to discussing AI, specifically ChatGPT. He advises that you use the subscription (paid) version. Train ChatGPT to suit your personality and the way you want to response (customise information), to avoid creating generic content. He uses ChatGPT to response to repeated client queries. ChatGPT can create articles for you on specific topics.
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Are you doing content marketing? For example, do you have 1-minute video testimonials from your clients? Get yourself out there with articles, podcasts, and webinars.
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Panos: "The meeting is virtual, but the relationship and the advice are real." Master the way to hold great teleconferences.
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Panos demonstrates relatively low-cost hand-held devices and software that enables him to shoot video clips like a pro and quickly. You can create good video with your phone, but you need a plug-in mic because the sound quality must be good.
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Web meetings Look at the camera. Make eye contact. Don't zoom onto your face. You should invest in a proper webcam and a lapel mic to have concentrated sound that cuts out noise distractions. You should have a greenscreen so that parts of your body don't fade out or disappear when you move. You don't have to create a studio. There is software that can simulate a greenscreen. Virtual background: OBS studio Panos uses Streamer X Audio Interface to create short music clips appropriate to the interaction with the client. It makes the interaction fun and sets him apart.
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You can ask permission from clients to create group meetings with someone they know. The more prospects you have, the more selective you can be in choosing people with whom you want to work. These are simple techniques you can use with social media. They can make a big difference. Are you a member of social media groups on which you post content that is interesting to them? Have someone create non-financial content that is topical to potential clients. You can include your pitch at the end.
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Do you note the names of three or four people with whom the client is connected on social media? Instead of asking a client generally whether he/she knows anyone who might want to use your services, ask specifically whether the client would have a problem giving you the phone numbers of those specific people?
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The new Phygital Advisor
The next speaker is Panos Leledakis (CFP), the CEO of International Financial Architects. Before you visit a new prospect, do you visit his/her social media before going to an appointment? You should. It will reveal a lot about the personality of the client.
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Responding to a point from the floor: watch your body language when responding without judgment. Your body language should not contradict your words.
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Building an internal locus of control in clients Make the abstract concrete. Instead of asking "What do you want to do in retirement?", ask "Let's talk about a typical Tuesday morning in your retirement? What are you doing? Who are you with?" Develop goals with a specific pathway to get there - "and the adviser will help you get there" Build self-efficacy by splitting up big goals into smaller goals. Find excuses to engage with the client. Celebrate successes. Anticipate barriers to clients' achieving their goals. Deal with the setbacks upfront. Avoid jargon (you don't have to prove your worth). Respond without judgment. Ask yourself: What need is my client trying to meet with his or her (negative) behaviour?
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Locus of control Individual's perception about the main causes of events in the life: either internal (their behaviour determines the outcome) or external (luck, fate, or other factors are determinant). Wealthier and more successful clients tend to have higher internal locus of control. Advisers can add value by taking a client who has an external locus of control and moving them to take control of their lives. Clients with an external locus of control are more likely to blame their advisers when things go wrong.
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Client values and goals Human needs are not static; they change. This is true for clients. Discovery cannot be once-off. We need regularly to revisit where the client "is at". We should go beyond broad-brush questions and find out what is motivating the client.
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Listening is a crucial skill for the adviser, particularly at the start of the relationship (during the discovery phase).
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One of the reasons clients leave is because of ambivalence. They are conflicted about the choices they must make. They know which option is right. The more the adviser pushes the "correct" choice, the more the client is likely to push back and defend the "bad" choice. Understand where the client is in this process. Don't push too hard or too fast - it will create resistance. Help the client to think through the choices and make the right choice for themselves.
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Understand financial instincts Humans are wired for instant gratification. People have a herd mentality. Simply imparting knowledge is not sufficient; people can get the knowledge elsewhere. It's how information is imparted and understanding the client's financial instincts. How can advisers combat negative instinct behaviours? Eliminate friction that encourages positive behaviour - for example, automated deductions for savings - and adding friction for negative behaviours. Remind clients of the "big picture" - the plan agreed on with the adviser.
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Adviser, know thyself. Trend is emerging: firms want to know about their advisers, not just their clients. What is the psychological make-up of the adviser? How does the fit with certain types of clients? How can advisers and clients be matched? Why did the clients leave or fire the adviser? Advisers need to know their own biases and what type of worldview they are bringing to the adviser-client relationship.
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Behaviourial finance is important, but it is only one aspect of the psychology of financial planning. Planners can help clients to overcome cognitive biases. Financial flashpoints are life events that have a lasting impact on clients' relationship with money. Planners cannot overlook these flashpoints.
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Psychology of financial planning
The next speaker is Dr Charles Chaffin, co-founder of Psychology of Financial Planning. His theme is the financial planner of the future. 1. Planners must "evolve or die". 2. Responsiveness is the value proposition of the planning profession. 3. Prediction. There are factors that can help us to predict how clients will behave.
Updated 373 days ago
Globally, research shows that the biggest barrier to approaching a financial planner is cost. It used to be trust. The research also found that awareness of the CFP certification has grown. +++++++++++++++++++++++++++++++++ It is now time for the lunch break.
Updated 374 days ago
Dante references research which found that South Africans who collaborate with Certified Financial Planner® professionals experience an enhanced quality of life, greater financial confidence and resilience, and increased satisfaction with their financial circumstances: "South Africans who work with a financial planner are better off, study finds" https://www.moonstone.co.za/south-africans-who-work-with-a-financial-planner-are-better-off-study-finds/ Financial advice is better than no advice, based on the survey's data points. But clients derive the most value from a CFP professional.
Updated 374 days ago
The trends and data tells us that technology will have a big impact on the delivery of advice and planning. Second, behavourial financial will growth as a core competency requirement. The biggest benefit of technology for planners will be more time to do financial planning with their clients.
Updated 374 days ago
What does SA research say that clients want? Mainly retirement planning, followed by investment planning and international/cross-border transactions. When SA were asked what they needed to learn more about, most said behavioural finance, followed by investment management, and coaching.
Updated 374 days ago
Technology will free up time for planners to engage in coaching. People need to motivation because we are basically undisciplined. Planners will play a greater role in ensuring that clients stick to their plans. Technology will enable planners to engage with their clients more frequently.
Updated 374 days ago
The impact of technology will the way you engage with your clients - such as onboarding, meetings. Technology will be the means in which you spend more time engaged in financial planning. Technology will free up time. Increased technology will help with analysis and assessment, collecting client information, developing and presenting recommendations. Dante refers to Open Finance - the accessibility it will create.
Updated 374 days ago
Technology is top of mind. Artificial Intelligence will have an impact on financial planning - good and bad. "I firmly believe technology will not replace [human advice." But advisers must be aware of the trends. 4 most important elements for a financial planner: trust, communication, professionalism, compliance. He wants to focus on the first two. The top two things that will have the most impact on financial planning: technology and human skills.
Updated 374 days ago
Future of financial planning
Dante de Gori, the head of stakeholder engagement at the Financial Planning Standards Board (FPSB), is the next speaker. There are 213 000 CFP professionals in 27 territories around the world. SA has 6th-largest number of CFP professionals: more than 4 000. FPI has celebrated 25 years of CFP certification.
Updated 374 days ago
Johan: the regulator should be encouraging financial access. He also notes that young people are not coming into the industry. Panel moderator Lelane Bezuidenhout asks: how does the industry retain young people? Tom: There has been a shift to among young advisers to their career future not remuneration.
Updated 374 days ago
Breakaway session: people remuneration models
Panel is Moonstone Compliance's COO, Billy Seyffert; Tom Brukman, director of Chartered Wealth Solutions; and Johan Minnie, group sales director of Liberty. The panellists agree it is unlikely commissions will be banned in SA. Most consumers simply cannot afford to pay upfront for financial advice only. Tom: We need financial literacy education; if people knew what they don't know, they would seek financial advice. We need transparency around charges. In the independent space, we see advisers charging on the basis of the complexity of the client's affairs and the work involved. Johan: asset-based model is popular, with upfront payment plus ongoing fees. Billy: The regulator should not regulating financial planning as a profession; it should be regulating the industry.
Updated 374 days ago
Vusi has finished speaking. It's time for the break, followed by the breakaway sessions.
Updated 374 days ago
Final takeaways. It's a mistake to see your market as a demographic. Today people are a psychographic, not a demographic. Thanks to the impact of media and social media, they define themselves by their aspirations. Value is changing. The first way value is changing is around identity. Expect more diversity; can your organisation accommodate this? Wealth is changing. Legacy is changing. And the most important one, and the one that poses the biggest problem to companies, is the challenge to the "archetype of binary ideas". This can be seen in the battle over gender identity. The "he or she" idea is being challenged more and more. In some venues, the male and female gender signs have been removed. The challenge to he/she is going to become more of an issue for companies.
Updated 374 days ago
The second key to success is the right culture, which how we work. The three pillars of culture are sharing, collaborating, and trust. He emphasises the importance of trust: it's a myth that great teams get along; great teams are open about their disagreements and continue to work together because they are invested in the project.
Updated 374 days ago
How to succeed? Basson told Vusi: you, as the leader, must determine the agenda (the context), not the circumstances. The reason most companies don't change their context is because their competencies don't translate.
Updated 374 days ago
Vusi asked Basson how he succeeded at Shoprite. He said: "It's making good decisions in tough times." In 1991, when SA was beset with political violence, Basson decided to open stores in the townships. Today, Shoprite makes about $2m a minute.
Updated 374 days ago
SA has many talented people, but politics keeps them from being used to fix problems. All over the world, the people at the top of their field came from SA.
Updated 374 days ago
The chief resource of a services economy is human talent. SA's 30% matric pass is major problem in this regard. "We are regressing." How do we achieve greatness? Vusi spent time with the management teams of Checkers and Pick n Pay. He spoke to Whitey Basson - "the most successful CEO in the history of South Africa".
Updated 374 days ago
In business, where does greatness come from? Why does one business do better than another? "Greatness isn't a data point; it's a choice."
Updated 374 days ago
The good news is there has never been a better time to be a human being than there is today. Economic growth and job opportunities have never been higher. A 100 or so years ago, people could die from illnesses that we commonly treat with over-the-counter medicine. The question is: how can business take advantage of the wealth of opportunities?
Updated 374 days ago
Vusi Thembekwayo: Leading at the Edge of Chaos
Vusi Thembekwayo has taken to the stage. "We are at the beginning of something special" - he is referring to the general election next year. Some 200 parties will contest the election. More choice doesn't necessarily result in better choices. This is also true in business and investment.
Updated 374 days ago
2024 convention announced
Scully has announced the dates for the 2024 convention: 14 and 15 August. The convention will be held in Cape Town next year, at the Century City Convention Centre.
Updated 374 days ago
Opening remarks by FPI chairperson Kirsty Scully
Kirsty Scully, the chairperson of the FPI has taken to the stage to welcome the delegates. The theme of the convention, Back to the Future, symbolises the use of technology in the financial planning profession. But the convention will address much more. Scully says financial planning is about more than numbers; it's about human behaviour.
Updated 375 days ago
Congrats Lara. Would love to catch up when suits you
Clem Goemans