Wealth manager Rowley Turton is trialling a new way for their clients to plan their financial future using a Return on Living (RoL) index. Is this step away from more traditional retirement planning the way forward? Scott Gallacher APFS, financial planner at Rowley Turton seems to think so.

Gallacher explains the reasoning behind the RoL index: “The intention is to help clients move beyond ‘Do I have enough?’ to ‘Am, I getting the best life possible with the money I have?’ How does it work?’

The RoL Index consists of 20 questions that are grouped into three categories: well-being, progress and freedom.

Figure 15: Opinions on the safest way to save for retirement, by age

Figure 15: Opinions on the safest way to save for retirement, by age

Gallacher says: “[The RoL] index is about where you are now, quantitatively measuring your view of your well-being, life progress, and feeling of freedom. The intention [behind the index] is that it helps the financial adviser, identify areas of the client’s life where they feel that they could be doing better.

“This gives the adviser the opportunity to add significant value, and become a ‘trusted’ adviser, by helping the client with financial advice, wisdom and guidance on what financial behaviours and principles need to be applied to improve the client’s situation.”

Gallacher believes the RoL index is a “natural progression” for advisers from traditional financial advice into more lifestyle financial planning, he says: “Society is also becoming much more experience-based with clients looking for more from their advisers. With increasing competition from technology such as robo-advice, this may be one way for advisers to continue to have a role moving forward.”

The index report is currently being offered to clients for free and Rowley Turton said that there were no plans to start charging for the service once it is live.

LEBC public policy director Kay Ingram says: “Research shows that if you want to encourage someone to save, in other words, deprive themselves of the use of their money until later in life, it is best to emphasise the future benefits of this, instead of channelling the fear factor, or paint a picture of deprivation in later life if they don’t save.

“Helping clients to dream and showing them that they can achieve their goals is one of the most rewarding parts of being a financial planner. When we recruit experienced entrants and graduate trainees in our [LEBC Group] Academy, we look for the ability to empathise and think creatively.

“This is more important than the ability to grasp technical information, which can be taught and increasingly automated. It is why we call our advice, bionic advice, as it combines automated technical analysis with human creativity to underpin the realisation of our clients’ dreams. It is also why we believe that robo-advice has limited capacity to perform financial planning beyond very simple short-term goals.”

Sabuhi Gard is an investment writer for Incisive Works

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