Cash Flow Service could become a nursery for Gen-Y Financial Planning Clients

A quirky “non-financial planning” business model built around low-cost cash flow management rather than traditional full-service advice is expected to become something of a ‘nursery’ for prospective clients. James Williamson, principal of Sydney north shore-based financial planning practice Millhaven Financial Services – which operates under the Australian Financial Services License of AMP’s Charter Financial Planning – plans to launch Moneyhaven in October 2015. The new venture will complement the full-service planning Millhaven provides to around 250 active clients. According to Williamson, the idea for Moneyhaven grew out of something of an epiphany. “We have a few clients that really weren’t hitting their goals. We’d sit down with the client and do the fact-find…but a lot just weren’t very accountable in terms of what they spend. “So we’re starting a budgeting and cashflow business that’s solely going to be concentrating on this,” Williamson says. He expects the service will be particularly appealing for Generation Y clients, who are often not engaged by financial planning. “We struggle to add value to those types of clients using the normal planning methodology,” Williamson says. “It’s not sexy, but we think it’s really necessary, because no one likes doing budgets, no one likes filling out spreadsheets. “But now, the software that’s out there…it is actually a really viable thing to do with clients now,” he says. A software package called Moneysoft, a budgeting and cashflow app, underpins the service. This draws ‘feeds’ of cash flow information by linking with clients’ bank accounts. “You can set it up, let it feed, and actually sit down with the client and say ‘right, you haven’t hit your goals because [of the outflow of cash]…we kept having to change SoAs, because clients would say ‘I’m only spending $80,000 a year’ when really, they’re spending $110,000. “There’s always an excuse, and that’s fine, we’re not trying to be too prescriptive, but at the same time…we can really then have a good look at what clients do [in terms of cashflow],” Williamson says. The Moneyhaven service will be offered to clients on a monthly fee basis, with no mandatory contract periods. While tools like Xero also allow cash flow information to be tracked, he says they are much more suited to planners and accountants rather than the general public. “Xero is great, I use that in my business, but it’s not really very user-friendly from a client point of view,” he says. Another tool called SuiteBox, an voice-over internet protocol-based application that provides video conferencing, sharing of screens and also enables documents to be signed on touch-screen devices, will also be integrated. In its initial stages, he says Moneyhaven will not be about financial planning, but expects that over time it will morph into an entry point to broader advice. Williamson is a passionate advocate of innovation among financial planning practitioners, believing substantial changes are required to better engage with more Australians. He expects many more developments lie ahead for those in the industry. “I think that’s probably the way it’s going to go for a lot of clients. You look at financial advice in 10 years time, I think it’s going to be totally different…we’re at a bit of a point where it needs a really big disruptor in the market to shake it up a bit.”   This article was first published in Professional Planner, by Glen Freeman on 27^th August, 2015 www.professionalplanner.com.au

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