Paraplanning has evolved organically to become an essential part of financial planning. Now it needs to be given the career status it deserves, says Lyndsey Fraser, member of the PFS Paraplanner Panel.
Paraplanning as a career has evolved massively over the last 15 years. Where it used to be seen as a rather nondescript administration role and a stepping stone for those who saw advising as the only way to progress, it has now become a career in its own right, and also has the potential to take people in other directions such as management, compliance, training and marketing.
Paraplanners are now in great demand but there is still some confusion as to what a paraplanner is and what we do on a day-to-day basis. Experience shows that the role of a paraplanner varies massively depending on the size of the firm and the responsibility level, workload and experience of the paraplanner in question.
As things stand currently, it is the individual financial advice firms that decide what a paraplanner does and who can become a paraplanner. Most firms will expect their paraplanners to carry out research, write reports and provide analytical support for advisers and clients. However, some firms have their paraplanners complete and submit applications, whereas other firms want their paraplanners to provide technical expertise on areas such as tax and legislation, with the ability to question and ensure the advice is correct. Some paraplanners are also expected to attend client meetings with the adviser and train other members of staff.
There are paraplanners that are relatively new to the role and starting to work towards an appropriate qualification, whereas others are classified as Chartered Financial Planners, and some have been working as paraplanners for in excess of 10 years.
Whilst many firms require their paraplanners to have achieved or be working towards an appropriate qualification, officially there is no minimum qualification requirement like there is for becoming an adviser. The qualification route itself can also be quite confusing, with no defined pathway and a number of different exams and certificates to choose from. For example, both the CII and the CISI now offer level 4 Certificates in Paraplanning. And the London Institute of Banking & Finance (LIBF) offers a Diploma in Paraplanning.
Paraplanning also allows for a lot of variety in terms of work set up – full or part time, office or home-based, employed or self-employed, in-house or outsourced and hybrid adviser/paraplanner roles, etc.
It’s all very inconsistent and this means that career progression will not be the same for every paraplanner.
Career pathway
In most industries, the career path tends to be very clearly laid out from outset. You join a company, you follow the predetermined career path, and you start moving up the career ladder and, most of the time, this means your job will steadily progress in terms of difficulty and responsibility, with the rewards of increasing pay. Jump into law, for example, and your boss will explain how to progress from a paralegal to an associate over the course of a few years. Unfortunately, financial advice firms do not tend to sit down with their paraplanners to go over this career progression and that is because there simply isn’t a well-defined career pathway.
Paraplanners tend to fall into two groups; those who see paraplanning as a career in its own right and those who see it as a stepping stone to becoming an adviser. Career pathways need to be developed for both groups to encourage all paraplanners to develop their own career aspirations and goals.
For the career paraplanner, firms need to look at ways in which they can take on more responsibility. This could be, for example, by helping to mentor and develop trainee paraplanners, to help recruit paraplanners or perhaps by becoming a product specialist or concentrating on one technical area of expertise, such as estate planning or tax advantaged investing.
Whether or not your firm has a defined career path in place, it is always worth sitting down with your manager to talk about what they envision the firm’s growth will look like over the next year years and what you would like to contribute towards the firm. Do not hesitate to bring up your skills and ideas for future progression. Communicating your goals and interests will help your manager to start guiding you towards the types of opportunities you seek.
How the PFS Paraplanner panel can help
As paraplanning becomes ever more important, clearer role definitions and career paths would make it easier to market paraplanning as a career to both a younger generation and a more diverse market. I think this is the only way we are going to be able to build a real profession and this needs guidance from a body like the PFS’s Paraplanner Panel.
The Paraplanner Panel’s first step in this process has been to put together a guide to help people learn more about paraplanning and how to take the first steps into the profession, which you can access HERE.
I think we also have a responsibility to help promote career paraplanning to the wider world. How many school leavers, or adults for that matter, would even know that paraplanning existed as a career choice? This will not change unless our industry helps to promote itself.
This article was first published in the November 2021 issue of Professional Paraplanner.
