Planning in Berlin: How to operate a business from offshore April 2021

Carolinebell

Caroline Bell is based in Berlin Germany, but until December last year was also a registered Australian financial planner. She is now the Advisory Board for her financial planning practice which she established 15 years ago – Summerhill Financial Services – with registered financial planner Alex Perini dealing directly with clients. Bell also manages the business strategy for the practice and has financial adviser experience in Germany. She shared her thoughts on the Australian financial planning industry with Industry Moves.

What has been the biggest change you’ve seen in the industry during your time?

I started my Diploma of Financial Planning and providing tax and financial advice in 1993 and have seen a lot of changes in the last 28 years, so it is hard to choose just one! I will try and consolidate a few changes into one, and that is the concept of what is advice and how to charge for advice. I have only ever worked in firms that have charged fees, but of course, I started my career in an environment where most advisers charged commission for just recommending product and that has evolved and now advisers realise the benefit of strategy advice and charging for the strategy - not the product recommendations. This of course will continue to evolve and develop and is one of the interesting things about the profession.

What changes do you expect to see in the future? And, what are you doing to prepare and adapt?

I have the benefit of being able to see financial advice in multiple countries, as a result of my experience in providing tax and financial advice to expatriates around the world, having been a financial adviser in multiple countries as well as my location, and it is interesting to watch the evolution of financial advice around the world. I think Australians sometimes underestimate how far ahead we are in comparison to the US, UK and Europe.

In terms of Australia, I believe we will continue to see evolution of what constitutes advice and how fees will be charged. Product advice will become just that - product, especially with the increasing technology which makes investment solutions easier - even if not necessarily less overwhelming to many people.

I believe that advice will become more about strategy rather than investment, as well as financial coaching. People know they should exercise, but they use a personal trainer to help maintain accountability and best methodology, and I believe that the same applies for a financial coach. This is one area where we have positioned ourselves and will continue to do so.

I also believe in the concept of hybrid advice. There are true benefits of robo advice, especially for those who may not otherwise have access to professional investment solutions. But there will also always be a need for a personal connection and a focus on someone’s unique situation.

Taking this into account, I also see the next stage of evolution being more about one off advice, rather than annual service fees, but I believe we are probably a little way off that.

How do you build your business and grow your client base? What has been particularly effective? (Marketing methods, referrals, advertising, etc)

This is an interesting one as I started my business in 2006 with only five clients, who took the plunge and followed me when I was working by myself with my own AFSL and no other support. I never did any marketing or advertising, but within a few years, the business grew to the extent that I had to create a waiting list for new clients, which we still have in place today. At that time, I just made sure everyone I knew, knew I had started my own business!

The reason for this growth was purely word of mouth, and I am very grateful to every client, friend and BDM who has referred clients to Summerhill, as those referrals then resulted in more referrals which resulted in a snowball effect (and hence the need for a waiting list). I strongly believe that focusing on the client experience will result in your business growing.

What is your point of difference in the market?

This is something that I find interesting to discuss with other advisers. I see so many saying that they are focused on the client, have X years of experience, not tied to any institution etc which is not ‘unique’. And having technical expertise is something that should just be a requirement for entry into the profession.

Don’t get me wrong, having my own AFSL from day one was incredibly important to me, and I never considered for a minute to go with a dealer, even starting from scratch with five clients, but it is not a point of difference in the market.

What is my point of difference and every adviser’s point of difference is them - each adviser as an individual. We are all unique and how we interact with our clients and the value we provide is often just down to the interaction and connection we have with our clients. I have a unique style, as does Alex (although I have tried to coach him into my style!) and this style may not suit everyone. But when it does and there is a match with how you make a client feel, a client will never want to change advisers.

What demographics do you cater to? (Age, occupation, etc)

There has never been a specific demographic that I have catered to or specifically targeted, it has always just been a case of focusing on clients who need and value strategic advice. This has included people across the ages from 35 to 85, professionals and self-employed, those who are already financially independent and those who are just beginning their financial journey. I have always enjoyed the variety, with my one requirement being only taking on clients who appreciate the value that we can offer. I applied this rule even when I was just starting out.

Why is financial advice important to you?

Ever since I was young, money has always simply meant independence, freedom and choice. Three things that are very important to me.

I also saw very early in my career how many people just don’t either really understand money and what it can do for them, or think it is too hard. I enjoy taking something that many people find complicated or overwhelming and making it simple. Seeing clients develop confidence when it comes to their financial situation and the peace of mind that it can bring is why I have done what I done.

Having financial confidence and peace of mind makes a tangible difference in someone’s life.

What have you done outside of the advice industry? Any interesting jobs?

I studied Commerce at University and then went straight into a large chartered accounting firm and focused on personal and expatriate tax. I started a Diploma of Financial Planning when I was 21, so I have always had an interest in tax and personal financial advice for individuals and my career has essentially had this theme throughout.

However, I have been able to apply my passion for financial advice, as well as constantly searching for new ways of doing things to a variety of roles, including coaching other financial advisers, managing an outsourcing project focused on expatriates as well as being a financial adviser in three different countries. I have also consulted to larger firms with regard to the client experience. So even as a financial adviser, I have had different experiences in terms of countries and size of firm and nature of clients.

What interests do you have outside of the office? What are your hobbies?

Normally travel, but COVID has put a stop to that! I will now limit travel to within Germany or within Europe that is accessible by car, but to be honest, just spending time with friends and continuing to improve my German - which will be a lifelong challenge!

Why did you decide to relocate to Berlin?

Purely personal reasons. I had always felt at home in Europe, and had also done so when I lived in London for a couple of years in my 20s. My personal situation changed a few years ago where I had the opportunity to base myself in Europe. I had always had the aim of running a business that could be run from anywhere in the world from day one.

Germany made sense, so it came down to which city I wanted to base myself in. I tried Berlin first, and it felt like home from my second day here. For someone so logical and practical, my decision to relocate was purely emotional!

It was a fun time - I was in my 40s, didn’t speak the language, nor did I know anyone. But I also knew that the worst case scenario was that if it didn’t work out, I would go back to Australia. But I also knew, that if I didn’t try it, I would regret it.

Is it difficult operating a business outside of Australia?

Actually no. But the key is having documented processes, effective use of technology and of course, a team that can operate effectively remotely. When I first established Summerhill in 2006, my idea was always to establish a business in which I could work remotely to be able to travel anywhere in the world, as I was the only adviser at that time and was trying to build a business. I have worked and responded to client emails while sitting at the bottom of the Great Wall of China, as well as cruising down the Nile amongst other places around the globe.

I introduced online meetings into the business around eight years ago, as well as regular video updates, with the aim of reducing office costs, continuing to be able to work remotely as well as being more efficient for clients and saving time (no commuting). Accordingly, not meeting clients face to face over the last year or so has not been new at all for our clients and so COVID-19 as not impacted our business model at all.

Even when I hired an adviser five years ago, and who started a week after I left the country, all of his onboarding and training was done remotely and online, until I came back for a visit 10 weeks after he started. We have our Team Meetings, including a Christmas celebration remotely.

Before Corona, I was coming back to Australia a couple of times a year to maintain personal connections, but that is not feasible at the moment, but it hasn’t been an issue. And as Alex has now taken on the day to day client advice, my next visit would only be to see clients on a personal level given many have become friends after being clients for so long.

It was only in my first year, where I was heavily involved in advice and training the new adviser that I worked more Australian hours, so some late nights/early mornings, but that didn’t last long.

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