#66 Luke Martins – Transcript

Louis van der Merwe
Welcome to another episode of Financial Planners, South Africa. Today in the studio I have with me Luke Martins. Myself and Luke met at the recent Financial Planning Institute convention. And I think he is must be one of the guys that’s the most passionate about this profession we call financial planning. So, Luke, thanks so much for joining me today.

Luke Martins
Yeah, thanks, man. I’m really honored to join your podcast to join the League of exclusive attendees here. And you’re quite lucky tonight. And I’ve listened to a couple and I’m really excited. So thanks for that.

Louis van der Merwe
Thanks for that. Look, I mean, it’s your passion comes through in conversations. And I think with previous cases as well, when we start talking about how, as younger financial planners, we can start changing this profession or this industry. But before we get into that, for the listeners, can you give us a kind of a short intro in terms of how you got into financial planning the new certified financial planner? How did you end up being a Certified Financial Planner?

Luke Martins
Okay, so I started my journey in accounting, actually. So my background was in accounting and auditing. And, and yeah, and I think that somebody introduced me to this kind of career advice. And I was like, actually so interesting, you know, you mean, you work with people, and you get to work in an environment where you can actually make a change. And I’ve spoken a little bit about how my family actually really got the opportunity to experience financial planning, you know, and so I thought, Okay, let me pursue this one. So I got through. And once I was done, I had my my qualification but needed a job. So I went and worked at Sanlam. And while I was at that, salon, it was it was really quite as quite nice as a brutal environment, I think, especially with the kind of view that I had initially about the industry. But I think the one clear vision that they had is they’re trying to diversify the adviser base, which presented an opportunity. And they also wanted to professional financial planners, and they identified the CFP mark. And so they put five or six of us on this journey of doing the post grad and do the actual qualifications. So each along that way, but in essence, my, my training environment was where it was actually very difficult to work in that kind of environment. Then after that, I applied for a job and then eventually a word to Alexander Forbes, as a planner, then, when that world moved on to being within a consultant, I really enjoyed that time there. But on SSML growth, I learned a lot about the industry. But I saw that there was something unique about where the industry is going, not just the technical elements about it, they were actually looking at, you know, maybe how does the conversation go with clients and I felt that the way I was doing things, I was perhaps missing something. And then the opportunity to work with an old mutual wealth as a financial planning coach in that space presented itself. And I really love that because that was really my mastering area I wanted to play in. And I’ve been with this business, in essence for now, nine years coming on just about 10 years, next year. So it’s been quite a long journey, but absolutely loved it.

Louis van der Merwe
Look, I want to go back to that person that introduced you to financial planning. How did they position it? What did they say to you that was attractive to you?

Luke Martins
So I think it was maybe maybe two main elements that are presented as a recruiter. You know, you can make money in essence but if we need students It takes a career that’s always slow is another nice thing to hear that actually, I can make a living out of this thing. But also, what was quite nice is the fact that you work with people, right? And you’re trying to, in essence, how people reach their goals and what they want. And so the story that they told me is that, you know, you you have to struggle through your education, as an example. But had you put your plans in place, you know, I mean, had the opportunities presented themselves with your family, they could have made a provision for that, you know, and I thought actually is quite brilliant. So many people don’t know about that. So many people actually face the headwinds of love when they get the so we know when I need to pay for university fees, that’s hard experiences, as Martins is quite often on the parent parents need to scratch around to find the means. And even if you get bursaries, you know, so no commission that I’ve come from, people don’t have money in essence, even when people have bursaries, bursaries are paying for maybe most bursaries, and outside of government stuff will pay for your books. And they’ll pay for your studies, it’s actually quite expensive to come from a village or wherever you live and go to a city and have to pay for your food, your transport. Back in that day photocopying, which is also quite an expensive, it actually becomes quite expensive. And it becomes quite a difficult journey, even through university and getting an education. If we haven’t put stuff in place. So there wasn’t anything I thought actually, this is quite brilliant, you know, my mom didn’t have a retirement plan. Nobody my family that I can think of has Walker journey, I think is something that I want to pursue. I think companies, in my mind, companies will always have money. And as an auditor, you always find work. But this is something different, they actually make an impact to the man on the ground. In essence,

Louis van der Merwe
it’s almost like someone just pulled back that curtain and said, Hey, is this world of financial planning? We tend to be reactive, let’s be a little bit more proactive and help people to to plan this. What did your family say when you said hey, I’m not gonna go this accountancy route, I’m gonna change careers, or did they even know?

Luke Martins
So it did what happy? Because what is this thing? Are you doing the Alesis? Yeah, what are you doing with a laugh? It’s almost a certain degree of disappointment. So the biggest thing is that, and quite often, it’s what I spoke about at the FBI as well, is that if you come from underprivileged backgrounds, like I do, right? So let me give you an example out of my mom, mom, she was one of eight. So we’re about maybe called close to 50 cousins that are in this age group, or they’re 6050 cousins, there’s only four of us that have a formal university education our parents didn’t have. So the point is that is that the the investment that they’ve made in you pursuing your career is because you’re there wants you to plow something back. And obviously for them, you decided on what you want to do is like, you know, what are you doing, you know, we’ve we’ve, we’ve invested so much in your journey, so you could plow back you know, what money is the selling policies and all that kind of we know people that so this is this is actually one of my cousins, says to be other people that sell funeral policies. Those people don’t even go to school for that. They they literally just were matric dropped out. You know what I mean? A non exciting funeral parlor, you’re gonna be doing that you just wasted your life. You know, in getting useless education only for you to end up. You know, like a guy who’s got a matric, in essence,

Louis van der Merwe
I mean, look, that’s a really difficult decision to make. When you’re 18, or 19, you just started studying someone tells you about this new potential career? How much time did you spend actually thinking about the impact researching? Or was it just wow, this is so exciting. I’m just going to jump into it.

Luke Martins
So yes, there was a part about how excited I was. And really what I did is I did jump into it. And I had, the research that I did was with successful financial planners. And quite often those are not the people to speak to. I can equate sometimes the father of financial planning, in essence, you running a financial planning business, you are an entrepreneur, right? Even if you’re working within a corporate brand, in essence, you’re an entrepreneur, an intrapreneur, whatever they choose to call it, but you in essence, are building a business within a business, right? Those are the worst kinds of examples. Even in business. You can’t take Elon Musk as an example and say, Okay, I want to be like Elon Musk, because your probability of being successful hinges on so much between you being a student and you being an A successful financial planner, right. And the one thing that I missed out on is how difficult that journey is, right? And and so that part I actually didn’t have include. And so the PRI people to talk to you would be a combination of these successful financial planners, but those guys are the cream of the cream of the crop. But also guys that are not that great that are B that have been working quite hard in this in this business and people that even are working two jobs as a financial plan and do something else. Because they found that difficulty in the greatest difficulty in being a financial planners getting access to clients. And as you get access clients, most people think if you competent, and you’ve got all your qualifications, you can be a relatively good financial planner.

Louis van der Merwe
That’s such a fascinating way of looking at it’s almost like saying you need to speak to the people that didn’t make it, you need to speak to the people that are struggling through instead of looking at the 1% and saying, oh, I want to I want to jump in her want to take the shortcut and take me directly they. But let’s talk a little bit about this challenge that you pose saying how do you build a client base? How do you serve clients? How did you personally select who you will be working with as a financial planner that have now qualified, maybe studying towards the postgraduate?

Luke Martins
So I guess my biggest gripe and something I spoke about as well is I think that needs to be a better focus on developing financial planners, right? Because I think the one thing that the industry has done very well with the FPR and universities and all those partnerships is that they’ve increased the standard in the quality of potential people to be financial planners. But obviously, the biggest thing is that this still is a bit of a struggle, around access to clients, and all of that kind of stuff that you need, all the all the personal qualities and competencies you actually that you need, on a day to day basis to become a successful financial planner. So in essence, when I worked for an insurer, it was very difficult it actually. And the biggest difficulty was that the insurance models, and I think that it’s such an important conversation to have, because it’s the elephant in the room. And I’m not in essence picking on any insurance. But there is all the biggest employers of financial planners, right? It’s not so much your, your independent financial planner, you can take one guy every five years, maybe your biggest employers are the guys are getting seven 700 to 1000 people into the industry as potential planners, with the success rate being minimal, you know, that means 5% or 10% of the three years or five years. So it’s something like that, we decide the vast majority of the guys will drop ourselves in that environment. And it’s very difficult, once and the main reason why is because that model was not a model that fits all right, the circumstances that I came from, I mean, in essence, the we had to do what they call a proverbial Ben Daffy, where you write down 100 names of the people that you’re after I’ve done that, what I’ve realized is the vast majority of people are new, either students, or people that have just started working. Or they were, you know, because I talked about your friends and your parents, friends, and all that kind of stuff. The vast majority of those were domestic workers, and garden boys, in essence, and I’m using a derogatory word, but in essence, they were, and petrol attendance, people that were not in essence, in the market that I was wanting to, in essence workings for in order for me to be successful. So it does make it a little bit difficult. But then there was a little bit of a difference in that moved on from me. And I worked in a in an environment where there was a access to a client base, but it was still a difficult because in essence, to source all my clients working in the inner space, but it was actually great in that there was a learning environment, because that three to four years, and when you start art is probably the most crucial. And you need the most development, hand holding. And there needs to be a clear development path in the career path. And then working in an environment where there is a clear career path where there is a development, space and an arena allowed me at least to flourish and actually to work as I relate to these. Okay, financial planner, and it wasn’t the greatest, but I was I was okay, you know what I mean? And so that’s sort of the important components. So my biggest passion really, in financial planning is yes, it talks about diversity inclusion. That’s, that’s a big passion of mine. And obviously, more importantly, is how do we grow and develop financial planners in this industry? How do we attract the talent and how do we retain the talent within this industry? Yes, obviously, my other passion is obviously client conversations and what but the other part about it is it comes in this little particular part about the journey of financial planners. I think

Louis van der Merwe
it makes complete sense saying that, once you join into a company, they are responsible of connecting you with your clients. But at the same time, if you think about these insurer models, surely In a world where social media is rife, we can connect with 1000s of people. Is it really that difficult to get access to potential clients? Like why are we struggling to get our foot in the door? As young financial planners? Do you think it’s a confidence thing? Or is it really just, you don’t know how to articulate what it is that you’re doing? Okay.

Luke Martins
So this is this is a, this is a nice conversation, because this, first of all, talk about somebody that’s a student that’s just finished university, right? First of all, if we talk about your personal attributes, you’re right, you might have a reasonable amount of conscientiousness, right? You can plan, you can put in your work, you can, you can have that kind of stuff. But in essence, the work that you had to do you are planning in essence for for tests, but in an environment, you are doing the minimum or the bare minimum, you have some some fantastic people learning for this the day before. And we and you see that the struggle of a student that’s not gonna allow you to be successful, you have a lot of personal attributes. And you actually don’t know what work is, until you get into that environment. That’s one crucial component of it. Right? So now, you’re taking somebody who comes from that environment. And you expect him to be able to be quite clear on how to manage the time how to manage the activities in sourcing clients, they’ve got no clue. So there needs to be a development path is to actually what do you do. And I have an analogy that I use, working with financial planners and that you need to teach students to work at your pace. Because what they come in on, they’re coming from an environment that is very slack, in essence, then people can get through an education system, without actually ever really putting in hard work because you have reasonable amount of intelligence. But work doesn’t work like that. When you’re in a working environment, you need to manage your time you need to manage your activities, and you need to put in the work in sourcing clients. So how do you prospect in the world that we working in for potential clients? I think it’s different now. Because in essence, when I started my journey that was now quality made 12 the 1213 years ago, but I think if we talk about the world of social media, the world of the multimedia world that we work in, you’ve got a lot more that you can call on meaning that you access to clients is not doing a big Duffey you access to clients is that how do I work a potential market? How do I prospect in this world, in order for me to get potential clients to get in front of potential clients? The one thing that clients are hungry for what potential clients we talk about prospects is they’re hungry for for information, and they’re hungry for access to information, right? That access for information provides you with a foothold to potentially do proper financial planning. So but it does mean that we need to put in the work in for example, and just offering people a budgeting workshop online using Zoom. And here’s the link, and you can come onto this. And then you do a proper job of providing all the tools. But that allows you to actually start having conversations with people. Financial Planners always often talk about unlocking wealth or unlocking wealth through conversation, the most important thing is for you to have that conversation. So how do I attract a client for me to potentially unlock this wealth? And what people are asking for saying, they’re saying, give me information? Let me take control of the things that I haven’t been taking control of my life. So So I want to know, how do I buy a house? I want to know, you know, I want to know, how do I create wealth? All that kind of stuff are important conversations. And so you can’t expect somebody who comes out of the chute environment to know what are those things you need to put into to in place a proper development path. So we can get you to a space where you can operate and walk at the pace of a successful financial planner?

Louis van der Merwe
Lucas, that why are we seeing these career changes, be more successful people moving from one career, let’s say education and the word teacher for 15 years, and now they’re coming to the industry, they have a bit more life experience to have. They are work ready, you know, they are moving at a pace that is more sustainable to deliver advice. Do we see that this other statistics telling us that those people tend to be more successful? Or is it just that they have a bigger commitment, they have larger bills to pay and they have to make it work?

Luke Martins
Yes, I also think so work experience is very important, right? Purely because you know, how you watching how you need to manage your time in order for you to be successful. But if we look at other careers, right? In some careers, there’s actually a proper training path which makes it okay for you. So if you’re a student teacher is a training and development path to get you to learn how to work and how to produce work. If you are in the CA program. There is a clear training path there and that training path not only teaches you the working age You know, but it also teaches you what are the personal attributes? You know? I mean, how do you develop your conscientiousness? In essence? How do you plan? How do you make sure you, you reach your toss, by the time you walk out of there, you know how to manage your time. So transferring from back to that career to financial planning makes a lot easier. The other thing, obviously, that helps is that you’ve built up networks and connections in working. So you’ve met people, you’ve met colleagues, so at least you can start to interact that way around. And also, there’s a certain degree of comfort in that you have some life experience. But that’s why I think it’s so important for financial planners to actually be quite clear. If I’m bringing somebody into my practice, how am I going to develop that person to get it from where they are, which is, in essence, a student who doesn’t really know nothing? To get into be? You know, where you want them to be?

Louis van der Merwe
I think Surely, it also helps us to be able to picture ourselves in this role in the future to say, am I do I have a future this business? Can I see myself progressing? And yet, if we bring it to independent financial planning practices, were we saying that, you know, maybe we bring in one person every five years, like you mentioned? How would you advise an independent practice to create a career path for a younger advisor, or maybe a para plan or even an administrator within that business? What would you say are the requirements for you to be able to put in this career plan?

Luke Martins
So I think there are a couple of things. So I think the one thing that is crucial is that you need to pay a salary, right? For what a salary allows somebody to do is that you’re not in an environment where you are so desperate for a sale, because that’s what happens sometimes when you, you, you’ve got bills, you know, I mean, you’ve got you’re hungry, in essence, right? That level of desperation, for me, it doesn’t lead to good financial planning, because what are you doing, you’re trying to get a sale, in essence, but you will pay a salary anyway, we’re quite clear in that salary that there is the MRP a basic, but there might be a variable component, but that variable component will be comprised comprised of tasks or activities, or what I need you to do, in essence, to be a financial planner. So yes, I’m earning, you know, 5000 Rand a month, but I can earn 10,000 Rand a month, if I get all of these components then do those measures are built on how they engage with clients. And I mean, and how they’re walking that journey towards where you want them to be. So that’s, that’s the one part about it. The other part about it, is going to be not just a monetary expense. There’s also an expense of Tom, and mentorship that you need to play in that role. And quite often, sometimes you might find people that bring somebody into the practice, they get annoyed, this guy’s not doing anything. But huge bear in mind, he doesn’t know what to do. So and then the other part about it is that you can also take a step journey that I’m not going to put you directly in front of clients, but we can build up towards that. So let’s first start you off, maybe impair planning, even Empower planning itself, you know, in doing a comprehensive plan, there’s a lot of work that’s entailed in all of that, but you might give them segments in a development path, to spend the first couple of months doing this, in the next couple of months, we’re going to add on to the so you can actually get to a level where I’m reasonably okay that you’re competent in what you do. But that means I have to spend time in mentoring in this process, then as other partner, I need to develop you into being a financial planner, what it means to actually develop that Engagement Roadmap with clients, I need to allow you to least be part of meetings to engage with clients. And in most businesses, you have C’s and DS, you have a tail that somebody can start to work with to develop their confidence in the competencies and then operate as a financial planner. But what does that means? It means that you might give up a tail, you know, in the long run. So I think they’re the one thing sometimes that independent planners, underestimate is the cost, right? The cost is not just the salary, right? The cost is also the fact that you have to spend time, right, but you have you know what your value is an hour of your time as a successful financial planner, it’s quite expensive, but you need to spend an hour mentoring somebody as well. So there’s that cost, the opportunity cost where you could be seeing clients, but now you mentoring somebody, but it does pay off in the end, because you have somebody in your business that’s competent. And also you can work out a split, you know, I mean, that yes, now that you’re part of my business, I’ll be taking so much as a part of this association or this brand, when you are a successful financial plan. So you actually get that back in the end, but you need to spend that time initially, to get that guy I’ve just been incompetent.

Louis van der Merwe
Luke, what strikes me is that this is no different from running any other business, right? It’s getting people to training them to do the service, or produce the product or make the widget and actually go and present that Your client base, yet oftentimes we hear that, oh, I don’t want to train up someone and I want to spend all the time don’t want to spend up all the energy just for them to leave or be poached by competitors. What’s your take on that? Is it a valid excuse? Is that a cop out? Is it just? Are we not creating enough incentives to retain that talent? How would you unpack that?

Luke Martins
So? So look, I think that, if I look back at, for example, businesses are relatively larger businesses. So the one that I used to work with, so most people would say, okay, you know, if you’re working, for example, for a bank or a corporate, you know, when you’re giving away half of your earnings in that environment, what you find is that there’s a certain degree of loyalty in that if I have a growth path, most people are right, in the fact that I might be giving away a portion of my earnings to have this association of his practice. But as long as there’s a growth path, you know, because in essence, most people are concerned with can I grow my earnings over a period of time and get to a point where I’m okay, I don’t have to sweat for for what I need to. So I have an idea of how much or how much is enough in terms of, of earnings, whatever it is, but you’re okay, giving away something if I can see myself growing, because I must have that what what am I making in the pocket type of story. So there’s that part. The other part is that, if you take at the look at the CA profession, they train a massive amount of CSR in this country, we have what almost 50, odd 1000 CPAs, but we have only about 4000, and a bit in terms of CFPs. Right? In that business net environment, there are right there, okay, letting go this year is not because it’s a small market. So Africa is a small market, some of them even go internationally. But what you’ve done is that you’ve increased the competence of the broader market. So you might lose somebody, but you might gain somebody from somebody else. And so you should be okay. And I’ve actually built somebody up, and I’ve have this. But I think where most people get hurt, is if you’ve intended for that person to be your succession plan, I’m leaving in three or four years time, I’m bringing in somebody to be my succession plan. But now this person I want to leave next year, now this person wants to leave my business. And there’s their kind of thing. And I mean, I was hoping to sell my business on to them. What that entails that you need to have a long view about your successor, and not trying to do a succession plan within five or so years of, of you leaving. So you need to have a long term view. But then you need to also train up more than one person to be your success in the business, because you never know what happens with people. So okay. I do think that the way we need to relook at how we develop financial planners is that, yes, I face need to look at it, but also the big guys, you know what I mean? They need to relook at how we are developing financial planners in that space. And the reason why I say that, that’s important, because of the amount of people that come through those, there’s that environment, because the one thing that people never consider is what happens to the guys that drop off, you know, vast majority leave, your experience of the industry is so terrible that you actually want to go do something else. Or you might circle back and try and get your opportunity to somewhere else. The other part about it is that what happens to those clients, you know, I’m in in the academy model where there’s 20 of us, when Luke leaves in month six, you know what I mean? sipo. And month seven will take over as clients. But suppose in the same as level of competence, we’re so desperate, where if he takes on his clients, he’s going to be trying to sell them something, or they might fall off and become orphans, or they might actually lapse and not become clients at all. So the point is, we’re not giving a good client experience. But obviously, the story and all of this in four ways, whether you’re an IFA, or whether you’re you’re a big corporate is the fact that you need to spend on this. So you can’t be greedy or complicated and hanging on to my C’s and DS and artell and HBO, Carolyn and go to the telephone, and IFA, if you’re working in a big corporate that how do we then find a model where people might be getting a bit of a salary and all have that kind of stuff? Sometimes that means you have to take a little bit off your top producers, right. And so the big fear is that if I, you know, I mean, some of these guys are getting 110%, of commissions, all that kind of stuff, because of all the benefits that’s wrapped up. But if I’m now charging a little bit from the top cars, but you have a fear that they might leave and go work for another insurer or another business. But in actual fact, if we have a consensus of a guy amongst these broader big guys, that we need to think differently about the way we developing financial planners, we need to rework those models. But it can’t happen from one company, it actually needs to be from all of the big players, right? And there needs to be consensus that actually, you know, I mean, are we doing the right And the ethical thing is, it might work out from a, from a productivity or from a profit point of view. But obviously the other part, which is my sort of passion is that is it the ethical thing to do for your clients that come through those models? Or they’re the guys that are the financial planners that we never really care about the leave, you know, the guys that have failed out of those models? Is that the right thing for those cars or for those people as well. So the point is that greed, either way, is not going to help in advancing the industry, whether you’re an IFA, or whether you are in a big corporate environment, we need to think about it differently.

Louis van der Merwe
You can like that part that you mentioned, is this the ethical component to this, because oftentimes, when we talk to clients, and we say, you know, by law, we’re not required to be fiduciaries, we’re not required to act in your best interest, we can actually put our own interests in front of your interest yet, in our business, we choose to not do that. We if we look at the American setup, you know, that legislation failed, they couldn’t pass the fiduciary standard, what do you think the odds are in South Africa that we get to a point where we’re forced by law to have a fiduciary standard, or at least from an insurance perspective that we forced to place clients in front of the profits of the insurer.

Luke Martins
So So I don’t think it’s look around. I used insurance as an example. But I do think it’s a broader point, I do think we can get there. But the one thing that I’ve seen with the other legislations that we’ve had, with its face phase, or any of that kind of stuff, because I sort of saw a little bit of the end of that environment, right. Or, or what was pending, or with us, for example, the the work that’s been done around, you know, what I mean, the ring fencing, the financial planner, Mark, and all of that kind of stuff, for in clients, for all of that to be successful. It’s actually not up to regulators, right, it’s up to each individual planner, and each individual financial planning business, to think actually, together, we want to do the right thing for for the business in the industry. And this is the path that we will take is we will take ethical paths, we will take a path of developing will take a pathway don’t put profits ahead of clients, or ahead of our people, you know, that’s the other thing is that some some sometimes the the right thing is ESG, and all that kind of stuff in your in your waiting for the environment. But sometimes we need to think about the people that work within the environment that we’re doing. Because at the end of the day, there are not enough financial planners, for the South African market. There’s not enough access to good quality financial planning for for the average person out there in the industry in the market. And so the more people we have working at, I think that’s often the fear is that, you know, I won’t make as much money if, if they are now there’s two of us. And we there was one of us operating in a market. But at the end of the day, there’s some there’s such a massive need, that actually we need as many people as you can given good quality financial planning.

Louis van der Merwe
So how do you see this pan out over the next few decades? How do we provide the rest of South Africa with good quality financial advice? I know we’ve had this conversation, but unfit like we started from scratch, but it feels like that progress is so slow that we’ll never get there.

Luke Martins
So I think there’s so I think we need to come back to if you are giving good advice, right? Because I think the one thing that’s quite clear is that there’s only US there’s although there’s lots of people in South Africa, there’s a small market of high net worth individuals, and most financial planners want to play in that space. So that means that what you only the 2 million or whatever, people that are potential clients are the ones we want to try and have a conversation with. But I do think that if I’m an IFA, me disseminating information around something as simple as as budgeting, and I’ve got all these platforms with a social media, because I know and alive for tools, you know, I mean, something simple that the average man can use, I think, doing that kind of I’m gonna call it volunteer or charity work, at least is a start is a start in the right direction, because, in essence, most people don’t necessarily need holistic, comprehensive financial planning, right? Most people’s need is that actually, you know, I’m struggling between wants and needs, you know, I can’t save. I mean, I can’t put stuff away because I’ve got all of this. So even getting a simple conversation around budgeting, or you might find some people are saying this is 15,000 Rand, I’ll only really only ever because I’m a particular government worker, whatever it is, Mama income growth is going to be limited by inflation over the years or whatever you negotiate. Right. So the point is that is that most financial planners are children is 50 Rand that you have in Your budget while you and your family, they can’t work with you, right? But it also might mean that actually how do we get people at that to be either will be looking for self directed tools only that kind of stuff, you know. So what it does mean is that financial planners will have to disseminate information, the guys that have got the budgets and the balance sheets need to think about how do we make financial planning available digitally, to a broader audience. And quite often, there’s this fear, especially amongst that just recording the bit, the bigger guys is that if I develop a I’ve got the budget to develop a self directed to write that might benefit people. I, my fear is that I might be alienating my distribution. But we all know that you’re good quality financial planning will never ever be able to be surpassed by digital to market a market process to technology develops. But right now, at the moment, you know, what we’ve seen from your betterments over the last is almost a single needs. And it’s mostly small money that’s going into that on call this moment, you know, but you know what I mean by that. So the point is that those soft directed tools are not going to be cannibalizing your high net worth individuals, but it will allow broader access for the rest of the market to get some kind of financial planning, although it might not be good quality, but it’s better than nothing, in essence, but it also means that the people with the budgets, need to think about these things differently, and may and put away something and start investing in something like that.

Louis van der Merwe
I like how you phrased that, that these digital tools will not support the value of individual advice. I mean, people still like that hand holding, and people need it. If you can pay, you know, the work of a GP to that of Web MD, you can Google all your symptoms, but that doesn’t replace doctor doesn’t replace that process. So look, your work as a financial planner, Coach, what does the conversations look like with financial planners? What are their concerns, other than, you know, finding a client base and kind of generating money? What are the most common concerns that you seeing right now and has that maybe changed post COVID.

Luke Martins
So the guys that I work with, so maybe let me describe the condo financial planner that we partner with. So it’ll be a relatively mature business. And generally will We will partner with with planning practices that say, I’m a right in terms of my technical skill and competence, because I’ve developed it. But when I’m looking, I’m looking to to, to take the next step, which is not become a trance, a planner, or technical planner, but introduce conversational base models to the way I do. So I want to focus on my client engagement. I want to either I mean, there’s so many so much wording around in industry, but they either want to look at behavioral coaching or look at, you know what I mean? conversational, any other conversational base, or behavioral finance or psychology, or introduce that client conversation element to my tumor, the way I do things. So what do you offer, say, okay, coaching is the way we do this thing. And so that’s how we, we partner with you. So those are the kinds of planners that I work with, I think a quite a lot of them were quite contented that they were safe through this COVID environment, because they have some of the competencies to deal with client concerns and barriers. And quite often the the conversations is really around like am your money manager hold your Mr. relationship with us really a coaching conversation around you feeling these fears? How do we manage those fears relative to what’s going on in the environment, and we can have that kind of conversation? Obviously, the biggest the biggest concern is, you know, I want the professional industry, I want that distinction of saying there’s a competence if the court lacks the idea around, bring fencing the the financial planning world. So if I’m a financial planner, I’ll have to say, okay, if I’m calling myself a financial planner, that distinguishes us from everybody else, and that word is protected, because there’s certain competencies and and there’s a journey that I need to get to to get to that poor part. The other part obviously, is that some people got a taste of technology. And so they like want to talk about, okay, how do I incorporate more of this technology component? There was a little bit of work that was done around investigating artificial intelligence and tools. But obviously, the next step is to say, Okay, how do I introduce what I would call emotionally intelligent tools into hard? How do you make conversation so the point is that what if what, what tools can I use that’ll give me a bit of sense of where the clients mood is where, where they sit in terms of how they show up, so I can bring that in. And that can be a point of, of conversation in my in my journey so it Want to try and pull in and draw in all these different tools and models, and all of that kind of stuff. So the point is that, that these guys are okay. But the big concern is what’s happening with legislation, as my clients concern, and then obviously, they’re looking for, for new developments around all these different components. But otherwise, they’ve been relatively alright.

Louis van der Merwe
What I’m hearing is that they’re kind of expanding the value offering, that they’re saying, Hey, we can touch more areas of a client’s life through having better quality conversations, not only maybe the money component, but making sure that, you know, we encapsulate the money within the rest of that clients life.

Luke Martins
Absolutely. And, and even if it’s, and also having a holistic view on the clients. And so I know that this person, for example, Luke, is married, and you know, me, there’s another component of okay, how have a half hour loud or created the space where we can have the conversation with the spouse, and the broader people that sit within this environment? So it talks around that sort of generational planning? And how do we have those, those conversations, because often, that’s, that’s a major struggle, that you’ve done all this financial planning, there’s all of these policies, whatever it is, that are paying out money they’re paying out, but beneficiaries take it and squander it, you’re gonna be sorry, I have better relationships, with, with beneficiaries with its mind and so, but at the same time, I can’t spend time with those people. So how do I incorporate technology into this conversation and social media and all of this kind of stuff. So I have a relationship with the broader family.

Louis van der Merwe
It’s fascinating, once we remove that script of this is the way we’ve always done it. And we can say, hey, this is, this is the future, this is what we can see. And these are the lives we we can change. What do you see financial planning look like? 10 years from now? Are we still going to have meetings with clients? Are we still going to talk about these things? What are we going to do more of and what will we be doing less of?

Luke Martins
So I do think in the future we were going into I think technology is going to become a crucial component of financial planning. And it’s going to be better use of technology, I think financial planners are taking to the hybrid. And I think that’s what COVID has really helped us with take into this hybrid environment. But obviously, the challenge is, is obviously your time, you know, and how much time you spend with clients. And so what people are looking at is that how do I incorporate tools that will be good, give me a better insight into my engagement with clients? How does my business have a better relationship with my clients. So that might mean that, you know, I must spend some money, or developing a client portal where I have my clients that have a sense of where their wealth sits, they can manage it, they master it across different platforms, they might be able to put in their goals, certainly stuff like that, that way, in a net harbored environment. People can engage with dashboards and around what their dreams and aspirations are, they can interact with it, it can be like a almost like a social media type thing where they engage with this client platform. But that’ll give you insight information from, from a planners point of view, when it comes to your engage with your clients. So those kinds of tools that at least allow you to have a better sense of client data. And having these different hybrid tools is going to give us a better sense of how we can give better advice to our clients. So there will be a deepening relationship with the use of these hybrid type tools.

Louis van der Merwe
I’m very excited. I think that sounds like a wonderful model where we can be more entrenched in someone’s life, and you might have smaller, more frequent interactions to kind of nudge them in the right direction instead of the annual big 100 page financial plan review, and nothing ever gets implemented.

Luke Martins
Yes, absolutely. And so I think that the biggest challenge even now, there are great tools, you know, but often those are all different, there’s certainly different areas and owned by different companies, you know. And so I think the biggest challenge is going to be have is going to have be aware of how do we work all of these things into an easy to use thing for me as a financial planner that I can engage with all these these different tools that LMS to give me better insight into my into my clients.

Louis van der Merwe
You. I want to thank you for your contribution today. It’s wonderful to chat to you can see how passionate you are and how easily you can predict what’s going to happen in the future. I guess time will tell we’ll do this again in a few years and look back and say remember, remember that prediction? See if you’re if you’re right or not.

Luke Martins
Yes, absolutely. I enjoyed it. Thanks for the conversation.

Louis van der Merwe
Thanks, Luke.