Growth is often seen as a sign of success, but knowing when to grow or, when not to grow can be just as important. On behalf of Sparkes Paraplanning, Lucy Paul – Head of Technology & Operations , reflects on the lessons learned from running a small paraplanning business.
Surfing is a constant exercise in listening and responding. A surfer studies the tide, the weather, the swell and the breaks, and once on the water, rides each wave by feeling the environment around them. A paraplanning business is no different.
Paraplanners work behind financial advisers, researching options, running the numbers and writing the reports that advisers use to recommend how clients save, invest and plan for retirement.
Many advice firms outsource this work to specialists like us. The quality of it shapes the advice people receive about their money, so we listen to the changing needs of advisers, and we adapt our workflows as the economy, the rules and the requirements shift.
Every year, tax laws change, new rules come into force and regulations shift. Keeping templates and checklists current, and working through certification updates and continuing professional development, is a core part of the business, and the time it takes is built into our model. Paraplanners cannot treat it as an aside.
From April 2027, unused pension funds are set to fall within the scope of inheritance tax, and ISA rules are changing too. Miss either, and we would be advising clients on yesterday’s rules.
In practice, this means that our paraplanners will review how pensions sit within each client’s estate, rethink the order in which assets are drawn in retirement and update our report wording so that the adviser can explain the changes clearly.
We would do all of this before the rules take effect, not after. The ever-changing regulatory environment is also what keeps the work interesting and fresh.
We also work in a world of precision. Accuracy and attention to detail are the one constant, and even a small error in a report can have real consequences for a client’s money and their future.
A pension switch recommended without full consideration of underlying guarantees or safeguarded benefits could cost a client guaranteed income in retirement. A trust recommended without weighing the alternatives could undermine inheritance tax planning.
Repeatable processes for triage, checks and quality assurance are what allow a paraplanner to stay balanced under pressure.
Alongside adapting to regulation, we adapt to demand, which raises a harder question: when is the right time to grow, and when is the right time to stay still? At Sparkes Paraplanning Ltd, we began recruiting because of the volume of work we were seeing.
Then a change in a client’s plans reduced the workload we had expected. We had started hiring before we were certain the work would last, and stopping cost candidates their time and raised hopes we then had to disappoint.
Telling the candidates we would not be moving ahead was hard, and hardest with one we were especially keen to work with. We had paddled hard for the wave, only to let it pass. We were disappointed, but as the information changed, we focused on building a steadier base.
That mistake changed how we think about growth. A small, stable company supports several livelihoods, and protecting them matters more than gambling on growth before we are sure.
We are now looking at ways to collaborate with other paraplanners, so that work can be shared when one person has more than they can handle, and so that we only hire when we are confident.
Sharing work would also create consistency because every report goes through the same checks, work can move between trusted colleagues without the quality changing. Any arrangement has to protect the business we have built so far.
Stability matters beyond our own business. A firm that is not stretched thin has time to check its work, which means more reliable advice for the clients who depend on it, and more capacity as demand for advice grows.
When a firm is small, every client matters, and the care going into the work is personal.
As we adjust to new regulations and learn from our mistakes, the goal is never to control the sea, but to keep learning so we can make the most of the waves we are able to ride.
Main image: surf, surf board, gian-luca-pilia-KxQYNqp329Y-unsplash
