Advice entrepreneurs in action: the power of education and social communities

Cutting through the jargon

In recent years, ‘finfluencers’ have found a wide audience on social media channels such as TikTok, YouTube, Facebook and Instagram where they offer a wide range of finance-related information.

Notwithstanding issues around legality, younger consumers are attracted to finfluencers because they use this group’s preferred social channels. And because finfluencers are generally young themselves, they talk the same easy-to-understand language and can break down complex topics into bite-sized chunks that are both digestible and relatable.

While many advisers think of Millennials and Gen Zers as the clients of the future, these cohorts clearly have a desire to improve their financial knowledge now so they can put the foundations in place to build a secure future.

And there’s a lesson here for all advisers.

Case study: The power of social communities

Recognising the appetite of younger clients for financial education, and the power of online communities, Adele Martin of Firefly Wealth (Firefly Wealth Pty Ltd, ABN 30 818 437 055), has built an offering around education and general advice only, called My Money Buddy. Where clients need personal advice, she refers them on.

Described by the Australian Financial Review as “the F45 equivalent for financial advice, charting a middle course between the DIY and the premium route of one-on-one”¹, My Money Buddy is a subscription-based program of tools, support and community.

This approach has proven especially popular with younger Australians. “While many people talk about the younger generations as the clients of the future, what we are seeing is a significant and widespread appetite for education on financial matters right now,” Martin says.

Delivered live online (with recordings available on demand), the My Money Buddy program comprises six modules delivered over a six-week period:

• defining goals and success
• savings systems and spending plan design
• superannuation
• pros and cons of shares and property
• debt
• money psychology and money habits.

Community and motivation are key

Among the practical tools Martin offers through the program are a series of negotiation scripts, which her clients can use to negotiate everything from a salary increase (one of her most popular) to a cheaper power bill. The community of program participants is also central to its success. Within a closed Facebook group, members share their goals and success stories. So powerful are her negotiation scripts and savings tips that most members usually achieve significant savings in a short period of time.

“This gives them the enthusiasm and momentum to keep going and many go on to seek one-on-one advice”, says Martin.

Online programs driving success

Martin also offers an online personal money coaching program, as well as a free podcast with its own community: the Savings Squad.

Using the Kajabi e-learning platform, Martin finds that online and video-based resources are not only more convenient and more aligned to the way younger clients want to engage, but they also bring significant efficiency savings, allowing her to sustainably offer her services at an affordable price. Her My Money Buddy program, for example, costs participants as little as $1,500.

“My programs are getting a younger generation ‘advice ready’, allowing them to gain confidence and trust in the process and outcomes of expert help,” says Martin. “This improves the client onboarding experience as clients can set their own goals, create a budget, and learn about concepts such as risk profiling at a time convenient to them. Instead of an adviser explaining everything over and over, a concept like this could be used in a traditional advice business to save advisers time and give younger clients the experience they’re after.”

Scale and efficiencies

Martin says she’s been signing between one and four clients a week to the program – even while on maternity leave and during COVID lockdowns, and with very little marketing. And while $1,500 per participant is well below the $5,000 to $7,000 she would charge clients for comprehensive advice, her overheads are far reduced for things like administration and paraplanning.

“At its scaled model, this is profitable,” she said.

Not only does the My Money Buddy program support clients in their early stages of the advice process, it has also had benefited Martin herself after the industry challenges of recent years.

“I think what’s it done more than anything is let me breathe and enjoy advice again,” Martin said.

Find out more

Innovation isn’t new but the way advice entrepreneurs look at common challenges provides fresh perspectives on how they do business. By shifting their focus to the client and approaching key facets of advice in innovative ways, they are making their business more efficient while driving better client outcomes.

To read more, download our paper, ‘How advice entrepreneurs are delivering cost-effective advice to more Australians.’ or check out our podcast series.

¹‘How the virus inspired the F45 of financial advice’, Australian Financial Review, 9 April 2020.

DISCLAIMER – IMPORTANT INFORMATION

This series has been issued jointly by HUB24 Custodial Services Ltd (ABN 94 073 633 664, AFSL 239 122 (HUB24) and XY Adviser Pty Ltd (ACN 45 606 168 781) (XY Adviser) and is current at the date of issue. HUB24 is the operator of HUB24 Invest (an investor directed portfolio service), promoter and service provider of HUB24 Super which is a regulated superannuation fund. The trustee and issuer of interests in HUB24 Super is HTFS Nominees Pty Limited (ABN 78 000 880 553, AFSL 232500, RSE L0003216). XY Adviser operates a professional network for financial advisers.

The information in this document is intended to be general information only and not financial product advice. The views expressed in this document by persons who are not representatives of either HUB24 or XY Adviser are their own, and do not necessarily represent HUB24 of XY Adviser’s views.

Neither HUB24 nor XY Adviser have validated or verified the views expressed in this paper, make any representation as to the completeness or reliability of the material in this series, accept any liability for loss attributable to use of this paper, including liability for any statements which are incorrect or misleading. Readers should not rely on the information in this paper and should undertake their own investigations and use their own commercial judgment. This document must not be copied or reproduced without the prior written consent of HUB24. © HUB24