This article provides a step-by-step guide as to how you can quickly and easily write a suitability report to a private client confirming your recommendations to top up an existing investment or pension.
1) Select or add the client
Go to write / view report and select or create the private client to whom you wish to write the report.
2) Add the required advice sections
Having given the report a name you’ll be directed to the Report Builder where you should add the necessary advice sections which in this case will be the
- Review of Your Existing Investments (or Existing Pensions), and
- Investment Strategy sections.
3) Complete all section wizards
Next you'll need to step through the section wizards of all of the sections that require your input, starting with the Introduction Section.
4) Complete the Introduction Section
You will progress through the steps of the Introduction section in the usual way. When you reach the Client Objectives step you should select the objective: “Top up an existing investment / pension”.
Having selected the objective you should click on the add kyc info link to the right. This will direct you to a new page where you can edit the wording of the selected objective (for example you could change it to something like "Top up your existing ISA with Transact"), and then add some further Know Your Client (KYC) information to it e.g.
“You wish to maximise the tax allowances available to you and invest a further £5,000 into your existing ISA with Transact before the tax year end”.
5) Complete the review section
You’ll be prompted to provide some basic information regarding the existing investment / pension within the Plan Summary step of the review section. As a bare minimum you should include some basic policy details e.g. provider name, policy number etc and complete the Top Up Amount £ field.
Remember you do not have to enter a value for all fields. Empty columns will not be included within your report.
In the Recommended Action step, you will need to confirm what action you are recommending in respect to the plan, which in this case could be:
- top up, or
- top up and switch the underlying investments of, or
- top up and switch the model portfolio of, or
- top up and rebalance the existing portfolio of.
You will also be prompted to summarise the on-going charges of the existing plan in the Plan Charges step. In instances where the existing provider also levies a one-off initial charge on the top-up then you can highlight this charge to the client in the Disadvantages & Tax Implications step of the review section. You'll notice that we've included the following standard advice option to cover such an eventuality:
"*INSERT PROVIDER* will apply a one-off initial charge of *INSERT*% which equates to £*INSERT* of the recommended top-up to your existing *INSERT* investment."
If you're recommending that the top-up monies are invested into the same investment strategy as the existing plan then do not create a Current Investment Strategy for the existing investment / pension in the review section as you will be prompted to include this information in the Investment Strategy section (otherwise you'll end up including this information twice and it will be repeated in the report). If however, you're recommending:
1) A switch of investment strategy for the existing investment / pension as well as a top up, or
2) The top-up monies are to be invested in a different investment strategy to that of the existing investment / pension,
then you should include details of the existing plan's Current investment Strategy in the review section, as you will include details of the Revised / new Investment Strategy in the Investment Strategy section.
6) Complete the Investment Strategy Section
Here you’ll be prompted to confirm the client’s attitude to risk and capacity for loss, as well as the investment strategy you are recommending that the top-up monies are invested into via the existing investment / pension.
7) Complete the Important Information Section
This is the last section you'll need to complete and is self-explanatory.
8) Tailor the structure of the report
Having completed all of the section wizards you should then tailor the structure of your report by unchecking any sections (e.g the Executive Summary, Table of Contents etc are a bit OTT for a basic top-up report) you do not wish to include in your report; and then change the sort order of any sections to reflect your personal preferences.
9) Download the report / covering letter
Click the download report / download cover letter icon and the report / covering letter will download to word.
By the way if you haven't already please check out our Suitability Report Sections Matrix. It's a great little tool that highlights which sections you should add to the Report Builder for a whole host of advice scenarios.
Hope that helps!