Tom Hegarty: The gold standard in paraplanning

By Tom Hegarty

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Sep 06, 2018

Paraplanning is a relatively recent function within advice firms.

Such roles did not really exist 20 years ago, as most advisers would tend to carry out all planning aspects themselves, including their research, technical analysis and suitability processes.

But thanks to regulation becoming more challenging, advisers have realised that separating the client-facing and non-client-facing processes can improve productivity and profitability.

Providing advice involves a wide-ranging skill set, unique to any profession. Advisers are not only required to be technically qualified but must also adhere to a comprehensive regulatory framework, have exceptionally strong interpersonal skills and ensure their businesses are sustainable, regardless of whether they are the principal.

But what do clients really value most from their advisers? Not the technical skill, regulatory fulfilment or business acumen. It is the interpersonal skills that instil trust and confidence. So it makes sense for advisers to focus on that area and use paraplanners to take care of the others.


Over the years, paraplanners have been defined differently from one advice firm to the next.

Some would employ them to offer basic administrative support to advisers; things such as photocopying, data entry and running simple reports.

Others would be the most technically qualified expert within the business. Advisers could refer to them to help explain complex planning issues, provide guidance on products and undertake comprehensive suitability reports and supporting research documents.

That said, paraplanners do not need to be employed at an advice firm. There are now a number of outsourced solutions offering services to firms as and when they need them, which can be more convenient and cost effective.

Another benefit of outsourced paraplanners is that they will work with a range of other advisers, adopting best practice where they see this. This may provide useful ideas to firms.

Some outsourced paraplanners are now proving so popular that advisers have been put on waiting lists. This seems to be in line with the general demand for paraplanners increasing over recent years.

Comprehensive definition

Although it has varied over time, we now have a more comprehensive definition of the role of the paraplanner, created through the development of the new paraplanner apprenticeship standard.

Launched in September 2015, this government-approved standard includes the knowledge, skill, behavioural competencies and qualifications required to be recognised as a professional paraplanner.

Like advisers, paraplanners are expected to be level four qualified as a minimum, but not in exactly the same way.

Apprentices are required to complete the Certificate in Paraplanning from either the Chartered Insurance Institute or the Chartered Institute for Securities and Investment.

The CII certificate includes RO1 (Financial Services Regulation and Ethics), RO2 (Investment Principles and Risk), RO3 (Personal Taxation) and JO9 (Paraplanning). It is the latter that differentiates between the qualifications needed by paraplanners and advisers.

JO9 is a comprehensive coursework-based unit covering all financial planning aspects expected to be conducted through the role of the paraplanner.

Paraplanners can play an essential role in the success, efficiency and profitability of advice firms, so a formally recognised route into the role will improve the health of the sector overall.

Tom Hegarty is managing director at NMBA

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