As most advisers and business owners know, it often seems like there’s no good time to take an annual holiday.
While that may be so, we all understand how important it is to get away from the industry occasionally and recharge our batteries.
Part of the worry about taking a long break comes from the fear that while you’re away a lot will happen. And particularly in difficult times when resources are stretched, there may not be someone available to absence.
Add to this the fact that the issues requiring your attention will not wait until you get back into work mode and you’ll have to get up to speed quickly and adapt to a changed environment.
So all that positive reflection while you were away which resulted in you deciding to focus more on your new income streams can all too easily get kicked into the long grass.
This problem is particularly severe for mortgage brokers who may feel the market is moving at such a pace that keeping up is almost impossible.
Adapting to a new environment and altering your business model accordingly is never easy, particularly if you see your core service – mortgage advice – as being less in demand than was previously the case.
The message about the need for diversification has been pushed to such an extent that I sometimes wonder if it has been overdone.
That’s why it was pleasing to see research from NMG highlighting that protection sales now account for 40% of the typical adviser’s income, with three-quarters of the brokers surveyed saying the product area is ’very important’ to their business.
Understanding that the market has changed and doing something about it are different things, so it’s to advisers’ credit that knowledge has been met with action.
Clients will expect advice and guidance on your new revenue streams for life, not just when it suits you
The fall in income from mortgages has been sharp – down to just 44% of brokers’ total average income, according to NMG. So a replacement had to be found.
It seems that brokers have taken the protection needs of their client base seriously, and sales of income protection and critical illness cover have helped fill the gap.
As a distributor we strive to provide our members with opportunities that don’t just fill a gap but deliver an ongoing income stream.
You should undertake diversification along with a full understanding of compliance issues, and no adviser should be thinking about ditching their new focus on protection, equity release or conveyancing if the mortgage market recovers soon.
These are income streams for life and clients will expect continuing advice, guidance and recommendations in the long term, not just when it suits you.
It would be a foolish firm that, having worked hard to improve income in these areas, put them on the back burner when the need for them is no longer so pressing.
The regulator’s responsible lending paper may have sent a shiver down the spine of many advisers but realists know the mortgage market has not been what we’d want for some time.
So my advice is to stay one step ahead. Your clients have many needs and you should help them with as many of these as possible, before and after your holiday.