What is a Paraplanner and What Do They Do?

What is a Paraplanner?

A paraplanner performs a very important role in the financial industry and enables businesses to operate much more effectively. However, many people are unsure of the role and often wonder “What is paraplanning services?”

Financial Advisor vs. Financial Paraplanner?

Financial advisers work directly with clients and provide services that enable them to invest their money most effectively. Providing this type of advice requires a lot of experience and detailed knowledge but it also involves a lot of administrative tasks that can be very time-consuming.

One of the most important of these tasks is to produce Statement of Advice (SOA) documents, which can often take six to eight hours for each client. Financial advisers usually find it difficult or even impossible to set aside this amount of time without distractions or interruptions and so often employ a financial paraplanner to undertake this and other work.

The best use of a financial adviser’s time is to interact directly with clients, finding out about them and their circumstances in order to be able to advise them on the best course of action. A paraplanner undertakes various administration tasks to enable them to concentrate on dealing directly with clients. These tasks include:

  • preparing the Statement of Advice and various other documents and reports
  • maintaining client files and updating records
  • using financial planning software to analyse data
  • preparing client letters, quotations, and proposals
  • organising client appointments and applications

A paraplanner’s role, therefore, is to help a financial adviser, mainly by undertaking administrative tasks, so the adviser can use their time most effectively to deal with clients. This makes the adviser much more productive and the business more profitable overall.

Although paraplanners do not usually deal directly with clients, they may attend meetings and take notes. This enables them to obtain the required documents, update client records, and perform other administrative tasks that result from the meeting. Some senior paraplanners advance to become financial advisers and so, as part of that process, they may become increasingly involved with clients.

What does a Paraplanner do?

The work of a financial paraplanner is dynamic and always changing, but a typical day may include responding to basic client queries, collaborating with the financial advisor to discuss SOA requests, and creating a to-do list for the day.

Throughout the day, paraplanners handle a variety of tasks, including managing the financial advisor’s schedule, creating and analyzing financial plans, assisting with client meetings, updating client records, and managing SOA requests. They also research tax and legislation changes and keep up-to-date with new investment opportunities to provide recommendations to their financial planning group.

These responsibilities not only reduce the workload of financial advisors but also provide paraplanners with valuable experience in the financial industry. This experience can lead to career progression and personal growth for the paraplanner.

Taking on Suitable Paraplanners

A paraplanner has a very important role and so when taking one on, you need to be sure the person is suited to the job. Educational requirements to provide financial advice are set out in ASIC Regulatory Guideline 146 within the Australian Corporation Act so you can ensure a candidate has the necessary financial planning knowledge.

Large financial advice companies with plenty of resources will often have their own paraplanning department with full-time employees in the roles. Smaller firms, however, may have limited budgets but can outsource the service by hiring contract paraplanners as they need them. This type of service also allows larger firms to deal with unexpected spikes in demand and to handle growth in workloads without taking on long-term commitments.

Employing a paraplanner, especially a contract one, can be seen as a risk due to uncertainty over skills and a perceived lack of control. Any risks are drastically reduced, however, if you use experienced and knowledgeable paraplanners from a reputable company such as TNW Solutions. All our staff know their job completely and provide a fast, comprehensive, and reliable service to all financial advisers. There’s no risk with our free trial so get in touch to experience our excellent paraplanning service.

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