Christopher Riddell - Wise Riddell Financial Group
GAMECHANGERS TALKS TO AWARD WINNING CHRISTOPHER RIDDELL, GROUP PENSION AND INDIVIDUAL INSURANCE ADVISOR OF WISE RIDDELL FINANCIAL GROUP
Q. Will you tell us more about Wise Riddell Financial Group.
Wise Riddell Financial Group has been a leader in providing personal financial planning services and is dedicated to building lasting client relationships. Our primary objective is to help our clients plan for financial security by providing quality planning advice and products through our highly qualified team of specialists augmented by a network of consultants. Our expertise comes from working with Physicians, Executives, Business Owners and also members of group retirement plans. We are client focused. Our role is to help our clients prepare for the expected and unexpected transitions in life. Our process ensures all aspects of a client's circumstances are reviewed and integrated into an individualized plan to meet their retirement objectives and achieve financial independence.
The founders of the firm have provided me with a strong base to work from and with some experience and momentum in some key areas we want to capitalize upon. My role is to focus on the areas with the greatest potential, and maximize the potential for the company in those areas.
Q. Can you tell us more about the pension/group retirement savings industry and financial planning?
The 2011 Survey provided by Canada’s Pension Landscape Report placed the value of the top 1,000 pensions in Canada at $1.12 trillion. The plan carriers (the institutions providing custodial services) are quite concentrated and very sophisticated, but the delivery of the plan at the member level has not truly evolved in 50 years. Yes, computer interfaces have been developed between the member and their money, but the take-up rate by members of this digital interface is less than 6%.
Unfortunately, the normal approach by group savings advisors is to provide companies and their employees with educational sessions once or twice a year. These sessions are voluntary to members, repetitive, sanitized by in-house legal departments and generic in their approach. As a result, attendance is abysmal. And, the results of this process are not encouraging.
Industry research shows that one in three workers isstruggling with their finances. This leads to stress which impacts on productivity. The same industry research showed that people who work with an advisor are improving their situation significantly and have, on average, three times the industry average in investment assets largely as a result of having a financial road map and the encouragement to stick to their plan.
So the question remains “should plan sponsors offer access to professional advisors to help?” To date, there’s been a low level of uptake on this model partially out of fear, but mostly out of ignorance that this approach exists and the benefits it can offer.
Q. What developments have there been since your father Kevin Riddell launched the firm 35 years ago?
Internally, since Kevin founded the firm, there has been significant growth in skill sets, broadening of perspective and enhancement of services. From a singular focus on risk management, the firm has grown into a wealth management practise taking a very holistic approach to planning and adding skills and competencies in a broad spectrum of disciplines. Kevin was able to attract leaders in their field who brought knowledge and expertise to an industry that was plagued by “Jack of all trades” purveyors of services. The firm developed a “team” approach to client service that continues to this day.
Externally, the group retirement savings universe has grown, but has not truly evolved. In 2004, the industry tried to get out ahead of the curve by developing its own set of Capital Accumulation Plan Guidelines (CAP), but the guidelines were unenforceable, not well endorsed and required a change in mind-set. Adaption of the CAP guidelines would raise the bar in terms of a members’ rights and expectations from pension plan sponsors (their employer), but without teeth, the guidelines have not created much in the way of change.
Members of even the most generous pension plans, like many individual investors, lack the experience, knowledge, inclination or patience to manage an investment portfolio; in fact, many want advice and assistance with their plans. Appropriate advice can help a plan member structure and manage a portfolio so as to maximize the benefit of their retirement savings plan. The CAP Guidelines place specific responsibility on companies to provide member education and support, and as the world becomes more litigious, this may become more prevalent, but presently, it receives inadequate focus.
Advice can also help to protect a plan sponsor against potential liability by reducing the risk of poor performance due to bad investment selection and management. If the plan sponsor does their due diligence in choosing an advisor, to provide voluntary advice to their members, they are actually shifting that risk to the professional who are trained, licensed and insured to provide such advice. Human Resource Professionals are not trained to provide insight into investment directions, nor are they qualified to suggest how much employees should be saving.
There is a perception that litigation will ensue if advice is provided, but this fear may be exaggerated as that approach is a threat to the conventional pension delivery model. If the advice is provided by a registered professional who satisfies industry and regulatory standards, the chance of successful litigation resulting from the questioning of the advice provided is limited.
Q. In your opinion what is involved in quality planning from an advisory perspective?
The better the discovery process the better the outcome. As our tagline says, clarity precedes success. The planning process, to be successful has to have equal parts empathy and mathematics, and a planner needs textbook knowledge combined with an acute understanding of human emotion as we need to get clients to do the things they would not always willingly do on their own.
I feel that creating a relationship and understanding the individual is crucial for effective planning. Of course having a well built and diversified portfolio with well managed investments and continuous growth is what everyone wants, but there are no two situations that are alike and, therefore, there is no single solution.
This is why group sessions for retirement planning are ineffective and engagement levels continue to be lack lustre. By getting to know every client and their personal situation, it allows us, as advisors, to build a plan that is suited for them and most importantly a plan they can stick with.
Q. What are the most detrimental risks involved?
As human beings, we are wired to do the things that are detrimental to our financial success. We all know to make money, you have to buy low and sell high, but emotionally, we buy based on good news (when the price is high) and sell on bad news. An emotional recipe for losing money, and the greatest risk for the results of the plan not meeting expectations. This is particularly true in a low interest rate environment where guaranteed solutions do not yield returns that would allow anyone to retire.
For us, being in the industry of advising clients on where to invest their money, there is always the risk that a loss due to one of our recommendations will result in some form of legal or disciplinary action. Even though this is a present day risk, we do our due diligence to make sure that every meeting is thoroughly documented. More importantly, we spend a lot of energy and time managing this risk before any case would present itself. We do this by employing a team to continually monitor the people behind the recommendations we make.
Q. What are the essentials in planning financial security as an individual?
As noted above, a good discovery process that gets the facts on the table, along with an empathetic state of mind, good math, and a process to continually review, monitor and report to the client should result in a successful outcome.
Secondly, being independent allows us to canvass the product landscape to find the best solution for each of our client’s needs, lower cost and enhance performance. While there are a lot of different career professionals out there that provide a great service to their clients, our independence allows us provide much more.
There is significant concentration across the Canadian investment landscape. Over 80% of individual wealth is controlled by the country’s five major banks and 3 largest insurance companies. Our independence puts us in the position to offer any strategy and any product to achieve the client’s objectives without being incentivised to use our sponsor’s products.
Q. What unique ideas and solutions does your work have on your business?
In the group savings arena, and with our model, a “rifle” approach is essential. The numbers are large, and the consequences can be significant; so avoiding mistakes is essential. The market’s exposure to the Wise Riddell brand will be key.
I have been able to bring quite a bit of exposure to our pension model over the past 2 years and will continue to do so. Industry experts are continuing to advocate for a shift to this type of model and we will be at the forefront of that movement. Our model has 15 years of proven experience at the individual client level and we will use that success to be a leader in reforming what is considered the norm.
Q. What changes have you seen over the past few years?
The introduction of wellness programs are becoming a huge part of the benefits provided by employers to their employees. There is everything from exercise programs and yoga classes, to smoking cessation programs and transit options. With this great initiative, should be the financial health of their employees. Improving their financial wellness will actually benefit employers tremendously as there is a strong link between how financially prepared an employee feels and how healthy, engaged and productive they are.
Q. Wise Riddell were recently awarded Top 20 Outstanding Independent Offices, what other highlights have there been over the past 12 months?
We have had a resurgence of youth in our office. Even though there is still some grey-hair hanging around, we have hired some young, enthusiastic individuals that really bring a lot of life to the office. It is this energy and enthusiasm that continues to drive us forward and provide that on going service to our clients.
In terms of recognition, I was also able to have one of our clients featured in Pension & Benefits Monitor Magazine. The article was a discussion of our pension model and how it has positively affected their business over the years. This was great exposure not only for the client and the work that they do, but for us to show how our model has been perceived in a Defined Benefit pension plan dominated industry. Their Defined Contribution plan has risen to the challenge of competing with the other big players on the block, a great achievement.
Q. Will you tell us more about the processes you are applying this year…
Our group retirement process, which was conceived 15 years ago, now services over 1,200 individuals across 5 different plans. Even though the process has refined itself over the years, the idea of creating a plan for individuals within a group hasn’t changed and continuing to provide quality one on one advice is our goal.
Our model or process was built on the acknowledgement that regardless of your level of income or retirement savings, a road map was critical. The goal initially is to make sure all employees are given the opportunity to meet with an advisor on a regular basis so that they, not only had a game plan geared toward their particular situation, but also regular follow up to make sure they are still on track. The next step will be to take this process to the digital landscape using “skype-like” tools to bring the process to remote locations as well.
Q. What defines Wise Riddell as a Gamechanger? How do you stand out from the crowd?
Our clients have more money than the average pensioner…plain and simple and meaningful results. The client noted above is a perfect example. They have a good pension plan. The contributions to the plan exceed the industry average by approximately 65%. However, the average assets per member in the plan exceed the average by 260%! Our process has allowed the members to see in real dollar terms the benefit of having a plan and sticking to the plan.
We have changed what is perceived to be a, “set it and forget it” mentality when it comes to group retirement savings plans. By taking the time to sit and meet with individuals and build them an personalized plan, we have been able to achieve participation rates that far exceed the industry average.
We are the only firm in Canada, that we are aware of, that is actively using an individual planning approach for our pension clients. As I have mentioned before, there are many other advisors that say that they will provide the one on one advice, but we are the only ones delivering on the claim.
Q. In your opinion, what are the key attributes to fit the “Gamechanger” title?
In my opinion you need to be at the top of your game and paving the way for those behind you. This means leading by example and showing a team, or an industry for that matter, that what you are doing is best way for everyone concerned.
In our case, we are changing lives, plain and simple. There are people that had absolutely no direction, no interest and no ability to understand their finances. By changing the way the group retirement plans are managed, we have increased the financial understanding of members, but most importantly the industry is taking notice that providing advice to members is in everybody’s best interest.
Gone are the days of letting people figure it out on their own, the opportunity for companies to offer advice is here and we are living proof of it.
Q. What motivates you as a business?
It isn’t altruism, but it’s a close second. If you can improve someone’s circumstances and get paid to do it, it is very emotionally and financially rewarding. If you were to show a farmer that changing the his methodology would produce a harvest 2 to 3 times greater than doing it the conventional way, why would you not share that message. Furthermore, if your income was directly connected to the farmer’s crop yield, wouldn’t that further motivate you to encourage him to adopt to your process and to speak to other farmers? And, I think everyone would view it as fair.
Our measurement is in terms of asset growth much the same way our clients measure their success as well.
Q. What does success mean to you?
Success means different things to different people. The desire to be successful is what gets me out of bed each morning and puts a smile on my face. But success has to be a shared experience. Success is a happy client with piece of mind enjoying a fulfilling retirement. Success is seeing smiles on my family’s face and being able to spend quality time with them. If I come home to a happy family, then I am successful in my personal life. If I’m happy to get up and go to work in the morning, then I am successful in my working life. I don’t need to be the richest man in the world, just one of the happiest. Everything else falls into place!
Q. What are the qualities a person must possess to be successful in business? What is your best advice to aspiring entrepreneurs and businesses out there?
It is wonderful if you can come up with an idea that no one has ever thought of before, but in reality, you just have to find an existing niche and exploit its inherent deficiencies. There are many more of those opportunities than there is a chance of you becoming another Apple. Look at the Gamechangers like Walmart or Starbucks who found a niche in an existing market and exploited it.
As a person, you need to be perceptive to the opportunity and persistent as there are always obstacles to doing something non-traditional. In business, if you have done your homework, the word “no” usually means “I don’t understand”. Never take “no” for an answer, take it as the need to reframe the solution.
Q. Where do you see yourself in 2020?
I see the company being able to grow exponentially over the next 5 years, but I want the growth to be smart growth. I won’t yet be 40 in 2020, and this is my career, and as it has been for me, hopefully an opportunity for my children to take it to the next level when I’m ready to refine my golf-game…but not just yet.
Q. What does the future hold for Wise Riddell?
We are a family business with my brother and myself now heavily involved in the day to day operations and the “founders” still very active. Managing the transition while managing the growth will be imperative. Look to us to reshape the pension landscape and revolutionize the delivery process.