What We Do
Foundation in planning
In goal-based wealth management, every investment solution relies on holistic, lifetime financial planning.
- Money is given jobs to do
- Clients, not the planner, define what the jobs are (meeting retirement spending from my own resources or helping my children financially)
- Jobs have outcomes that clients can both relate to and engage with (real spending power of £x in year y)
- Clients define the priorities and constraints (we want to help the children as early as possible but we must be confident our retirement spending needs can be satisfied, however bad the economy and markets might turn out to be, before we gift)
- Clients directly exhibit their own risk preferences, in how they prioritise and set planned outcomes, including worst-tolerable outcomes, to achieve the most efficient use of capital across different goals that compete for resources
- Risk preferences informed by outcomes, usually expressed in real or spending-power terms, tend to be different (sometimes radically) from preferences previously divorced from goal-specific trade offs and which instead refered mainly or exclusively to short-term volatility, in money terms
To the client of a goal-based wealth manager, ‘most efficient’ has a particular meaning, as the set of outcomes that would deliver all the different forms of benefit from their wealth (what, who, when, how?) that they conceived when doing their planning. Delivering solutions that maximised these benefits would mean that a client, late in life, would look back and think ‘job well done’ and ‘no regrets’. Good planning involves thinking about what those benefits would be earlier in life and what you need to do to put you in that position later in life.
At the time they commit to a planning exercise, or ‘Initial Review’, with Fowler Drew, clients value it on its own merit, for the clarity they expect it to bring, without necessarily deciding whether to go on to retain us to manage goal-based portfolios. Some have a clear expectation right from the outset to retain us. Some self-directed and highly-skilled investors have no expectation to retain us but value doing their planning with investment experts. Others let the planning process itself determine whether or not they change their management arrangements.
