What is Goals Based Advice?

Goals based advice quite simply links a client’s individual goals directly to the design of their portfolios, so the likelihood of achieving those goals is improved.

The traditional approach to building a portfolio is to use risk profiling to match a client’s investment risk tolerance to a Strategic Asset Allocation (SAA) benchmark, which by definition is more backwards-looking and static in nature.

Goals based advice is different. It seeks to look forward – using a more flexible portfolio design methodology and Dynamic Asset Allocation (DAA). The primary aim is to achieve a specific outcome or goal. It may be to achieve a real return objective (i.e. above cash or inflation) over a given time period. It may be to manage ‘risk’ within certain parameters. It may be to ensure that capital is available at a specific point in time by using liability matching or  Liability Driven Investing (LDI).Regardless of what the primary driver of a portfolio may be there is usually a strong focus on downside risk protection.

There are many ways to provide Goals Based Advice depending on everyone’s different circumstances. AGBA is dedicated to helping you achieve your goals, whatever that journey may look like.

Here’s what Fergus Hardingham from FM Financial Services says about goals based advice

An adviser’s role is to give greater certainty to the achievement of their client’s objectives.  We changed our approach to building portfolios after the GFC as we believe the ‘old way’ of portfolio construction, relying solely on long only investment approaches with equity dominated portfolios failed clients.  Being part of AGBA has helped our firm to learn from other advisers.

Here’s what Sarah Abood from Profile Financial Services says about goals based advice

We were so happy to find AGBA. The chance to discuss real-world issues with other like-minded advisers, as well as the support from providers who really ‘get’ what we are doing, has been so valuable for our firm. We come along to as many events as we can, and always go away with useful ideas we can implement in our practice.

Here’s what Matthew Walker from WLM Financial Services says about goals based advice

Being part of the AGBA network provides really useful contacts and insights that enable us to continue developing our business in the way we want to, which is to put the clients first. It’s not always been that easy in an over-regulated institutionally driven industry, but with AGBA’s drive to bring world class solutions to IFA’s and through meeting other like-minded IFA’s we feel like our business, and the industry as a whole, can really thrive and develop into a fully professional industry we can all be proud of.

Managed accounts ideal for goals-based shift - Financial Observer Nov 2017

Financial Observer's Sarah Kendell, on the back of our 2017 annual conference writes, "Managed accounts were...

The PI risks of goals-based advice - IFA Nov 2017

Jamie Williamson with the IFA, writes "financial advisers making the switch to goals-based advice must ensure...

‘Goals-based advice’ is not new - Robert Coyte for IFA

Robert Coyte, chief executive of non-bank licensee Shartru Wealth, writes an interesting and balanced opinion piece...

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