When it comes to crafting suitability reports, it’s easy to feel overwhelmed by the balancing act of meeting compliance, maintaining personalisation, and keeping things simple enough for clients to understand. Jenny Hunter, Senior Financial Journalist at IFA Magazine, speaks to three industry experts to dive into their practical tips on everything and anything to do with Suitability Reports.
From incorporating templates to ensuring clients understand technical concepts, as well as how to turn client objectives into SMART goals, with input from our three experts—Caroline Stuart, a Chartered Member of CISI and CISI Accredited Paraplanner from Sparrow Paraplanning; Melony Holman, Managing Director of Compliance & Training Solutions (CATS); and Damian Davies, Managing Director of The Timebank—we explore how to create reports that are both compliant and client-friendly.
The second article in our three-part series on suitability reports dives straight into the “how” of report writing. We’re tackling those common questions paraplanners and report writers often face but aren’t always confident about. Hopefully, this clears things up!
Templates with a personal touch
Suitability reports often begin with templates, but keeping them personalised is crucial. Caroline Stuart offers a realistic view on the matter: “Many firms use templates or report-writing software. The key is that the final report given to the client must be personalised and bespoke to them.” She notes that while templates can save time, the customisation part often takes the longest, especially for complex cases.
Melony Holman emphasises that client objectives should take centre stage: “Remember that client objectives are not investment objectives; they are financial planning objectives[JH1] . The templated part is useful for technical aspects but should still reflect the tone of the firm and adviser.” Holman also suggests using a tone that resonates with clients, helping them connect to the report. Damian Davies agrees but warns against thinking of templates as rigid: “Instead, think of a template as a structure. The content should be unique to each client, but the structure helps create consistency.”
The bottom line? Templates are tools for efficiency, but personalisation is the magic ingredient that keeps them relevant to each client’s unique situation.
Jargon busting
A common challenge is explaining complex concepts without overwhelming the client. Caroline highlights the skill of a great paraplanner: “Simplifying the complex and translating the technical into normal language.” Her practical tips include using plain English, avoiding jargon, and breaking down ideas into digestible chunks. She also advocates for the use of diagrams, charts, and graphics to make technical information more relatable.
Melony adds that keeping the client’s previous experience in mind is key: “The report needs to be written with the client in mind, using a tone and language they relate to.” She finds that clients respond well to reports written in a Q&A style, as this directly engages them in a more personal way. Damian takes it a step further, linking the need for clarity to Consumer Duty regulations: “Getting the client to sign the report isn’t enough. You need to combine controls (documents or policies) with evidence (data). For example, having a resource area of videos or guides about ISAs is a control. Proving who has visited that resource is data.”
By keeping things simple and asking for feedback, you can ensure clients fully understand the recommendations being made.
From objectives to SMART goals
Client goals are the foundation of any suitability report, but turning them into SMART objectives—Specific, Measurable, Achievable, Relevant, and Time-bound—can be tricky. Caroline points out that generic objectives won’t cut it anymore: “We need to understand the client’s ‘Why’ if we are to provide advice that helps them achieve that why.”
Damian echoes this and points out a common mistake in the industry: “The industry has an unfortunate habit of interpreting client objectives and putting them into financial speak[JH2] . For instance, a client might say they are confused by the different pensions they have, and this gets translated into wanting to consolidate their pensions onto a platform.” Instead, he suggests letting clients express their objectives in their own words, which can then be crafted into SMART goals during the fact-finding process.
Melony adds that while it’s usually the adviser who gathers the client’s objectives, it’s often the paraplanner’s job to turn them into actionable goals: “The planner should be capturing the client’s own words so these phrases can be lifted directly into the report, making it more engaging and ensuring the client understands the report is about them.”
The clearer the objective, the easier it is to build a plan that reflects what the client truly wants.
Goal collecting? Adviser or Paraplanner?
The collaboration between the adviser and paraplanner plays a significant role in shaping the client’s objectives. Caroline believes it’s generally the adviser’s job to obtain the client’s goals, as they own the client relationship. However, it’s often the paraplanner who takes these goals and turns them into the SMART objectives needed for the report.
Melony agrees but highlights that planners need to capture the client’s words as closely as possible: “The planner should be capturing client phrases that can be directly included in the report, ensuring the client remains engaged and feels the report is tailored specifically to them.”
Essentially, the process is a collaboration, with both roles crucial in making sure the client’s objectives are accurate, actionable, and clear.
How long is too long?
One of the most common questions in the field is: How long should a report take to complete? Unsurprisingly, there is no one-size-fits-all answer. Caroline admits, “There is no fixed timescale. It wholly depends on the complexity of the report and the client’s situation. However, we need to be efficient and effective—no client should be waiting months for a report[JH3] .”
Damian breaks it down further, distinguishing between “the lifespan” and “the turnaround.” “The lifespan is the time from seeing the client to getting the report back, which can be anything depending on how quickly you can gather the necessary information. The turnaround is the time it takes to produce the report once all the data is available.” He stresses that while providers can be slow in delivering information, it’s important for firms to streamline inefficiencies to avoid unnecessary delays.
Efficiency tools like templates, software, and AI are becoming more common in the industry and can be used to speed up the report-writing process as long as they don’t sacrifice the personal touch.
Putting it all together
Creating suitability reports that are both compliant and client-friendly involves a delicate balance of efficiency, personalisation, and clarity. Using templates can streamline the process, but the key is tailoring these to fit the client’s unique needs and objectives. It’s essential to translate technical jargon into understandable language and to ensure the client is engaged every step of the way.
By collaborating effectively, advisers and paraplanners can turn client goals into actionable SMART objectives, ultimately providing recommendations that align with the client’s true financial desires. The ultimate goal is to create reports that are not only fit for purpose but also meaningful to the client.
In our third and final article next month, we will be focusing on how you can get the look and feel of your Suitability Reports just right so they engage your clients but also deliver all the necessary information required. Watch this space for that!
