Lifespan Invest Archives - Lifespan Financial Planning

Lifespan FP 30 Years of supporting advisers

November 25, 2024 by Lyndal Higgins

This year, Lifespan is marking a significant milestone, celebrating 30 years of supporting advisers.

From the very beginning, Lifespan has been passionate about supporting advisers to build sustainable advice businesses. Thirty years is a long time in financial services! Eugene Ardino, Lifespan CEO, and his father, John Ardino, founder and Chairman of Lifespan, reflect on the past thirty years and discuss where to from here.

John, what motivated you to create Lifespan back in 1994?

At the heart of it, I really wanted more security for my family. I was also very keen to have greater control over my destiny, and I could see a real opportunity to capitalise on my strong relationships with accountants and my connections in the investment research space. Back in the early 90s, there was a strong appetite amongst accountants to become financial advisers, and I saw a growth opportunity in this space.

Eugene, you were still a boy when your dad started Lifespan. What were your earliest memories of this time?

My earliest memory of the business was probably in its first year or two. I remember helping to put together the first compliance manuals. I also remember this really weird large-looking contraption called a franking machine. You’d put your envelope in, and it would stamp it. Of course, those were unpaid roles. I’m sure I got paid in other ways, but my first actual job at Lifespan was in 1999, in my gap year, before starting university. It was a family affair. My uncles John and Caesar worked there, along with many others. After finishing university and travelling the world, I returned to Lifespan, working across the business in compliance and business development roles, before becoming CEO in 2015.

John, what were some of your biggest challenges in those early days?

It was quite daunting starting from the ground up, especially when it was just me directly involved in the business. I did everything, from reviewing financial plans and recruiting new advisers to organising and presenting Professional Development Days. The biggest challenge back then was attracting larger, more established practices. Remember, this was a time when the big banks and institutions dominated financial services. There were also large incentives offered to practices joining these larger licensees and substantial marketing and technology support offered, and this was something that we, at the time, struggled to compete with.

Looking back on the last 30 years, John, what are you most proud of?

I am most proud of our relationship with our advisers. Some of those who joined us during our first few years are still with us, which is incredible.

Was there a pivotal moment that you believe shaped Lifespan’s growth?

John: I would say that would be launching the Omniport Wrap account back in 2001 after over two years of due diligence. This provided Lifespan with more diversified income whilst also being a great solution for clients.

Eugene: Yes, the wrap was a response to where the industry was heading at the time. Dad was always very good at anticipating the future. Without it, it would have been tough for Lifespan to stay viable back then. In my career, one of the important moments was setting up the managed portfolio business in 2011 and making the strategic decision in 2016 to focus our resources on building this out.

Eugene, can you discuss a time when Lifespan had to make a difficult decision that benefited its advisers in the long term?

It has always been a difficult balance to ensure that Lifespan remains sustainable. We have sought alternative revenue streams, alongside managing to only increase our dealer fees significantly around three times in 30 years, which is pretty impressive! These fee increases all coincided with major reforms. Over time, we have also had to make contentious decisions with respect to approving products through our investment committee. Overall, we have taken a conservative approach and have had to say no to many products. These decisions, at the time, were often not popular, but we were always focused on making decisions that benefited the adviser collective and protected the reputation of Lifespan over the long term.

How has working together as father and son and family influenced Lifespan’s culture and direction?

John: Well… no one can deny that it is genuinely stressful working with family! However, thankfully, even though we all have strong personalities, we are all accommodating of each other’s opinions! We do listen to each other, and we make sure that we enjoy ourselves. You’ve got to enjoy it. It’s got to be a bit of fun!

Eugene: Dad and my values are always aligned. We can disagree, but our strategic direction is almost always in sync. We approach things differently, and bring different perspectives, as do many of the Lifespan team. As a family, we challenge each other in ways only family can! Our team and advisers are our extended family, and we want to make everyone feel a part of that.

John, where do you see Lifespan in ten years’ time?

There is always a market for what we have to offer. As a privately owned but larger group with the infrastructure to support advisers, our approach will continue to appeal for years to come! We have always treated our advisers as family and not just cogs in the wheel. Advisers will continue to look for a business partner that is responsive and supports small businesses.

Eugene, what are some of the biggest challenges and opportunities that lie ahead for Lifespan in the next 5-10 years?

Let’s discuss the opportunities first, as I believe there are many. The biggest one is the professionalisation of advice. Although sadly causing many to leave the profession, the education requirements resulted in a significant shortage of advisers. With the great wealth transfer at our doorstep, or already here, there is and will be an emerging need for advice. This adviser shortage, however, is problematic if you are looking to grow your practice and employ additional advisers to service this advice need. I also see the deregulation of Delivering Better Financial Outcomes (DBFO) resulting in a more streamlined advice process, hopefully enabling advisers to support more clients.

In terms of challenges, none of them are overwhelming, in my view. As I mentioned, the decreased number of advisers is a challenge due to the increased demand for advice. Finding quality staff will continue to challenge advice firms, especially for those who are not comfortable with offshore, outsourced solutions. Although technology presents an opportunity with its capacity to innovate and streamline advice delivery, it will continue to challenge advisers. Seamless integration will need to be addressed by providers to address the sense of overwhelm that many advisers experience when addressing their technology needs. I also believe that economic headwinds will challenge advisers who position themselves purely as investment experts over the next few years. The attractiveness of managed accounts will continue to grow as advisers seek ways to gain efficiency in advice delivery and the desire to spend more time with their clients.

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As we celebrate our 30th anniversary, Lifespan’s journey from the very beginning mirrors the evolution of the broader financial advice industry. From navigating the dominance of big banks to embracing technological and regulatory change, Lifespan has had to continuously adapt and identify opportunities to grow and develop its service offering to its advice community. Most importantly, our commitment to maintaining strong relationships with our advisers, team, and industry partners has been key to our longevity.

We are excited to embark on our next chapter and look forward to continuing to support advisers for many years to come. Thank you to everyone for making Lifespan what it is today and what it will be tomorrow.

2024 Australian Wealth Management awards winners

May 27, 2024May 9, 2024 by Lyndal Higgins

Lifespan Financial Planning winners of the Australian Wealth Management Awards Best Independent Dealer Group 2024

Lifespan Financial Planning was announced last night as winner of the Best Independent Dealer Group of the Year at the inaugural Australian Wealth Management Awards. Lifespan adviser, Angus Taylor of Sheffield Financial Services was recognised as the Best Young Adviser of the Year.

As Lifespan CEO Eugene Ardino said, “Congratulations to all of the team at Lifespan as this is very much a team award which we could not achieve without the hard work, dedication and passion that each and every one of you show day in, day out!”

And from founder, John Ardino, “It is truly a testament to the whole team. Each adviser and client responds to aspects of the whole business. Thanks all for working so well together to serve our community.”

These awards champion the achievements of the best and brightest in the nation’s wealth management industry.

A total of 25 winners were chosen out of 228 finalists across every sector of the wealth management industry.

The black-tie gala ceremony showcased the depth of talent in the nation’s leading professionals and businesses in the wealth management industry while affirming the sector’s essential role in supporting the expansion of Australia’s economy.

The entire industry gained national recognition for excellence at the premier awards night, from executives to rising stars, as well as asset and fund managers, super funds, insurance firms, innovative technology firms, dealer groups, custodians, ETF providers and financial advisers.

Link for the award acceptance speech.

Click here to view the full list of winners.

ifa Excellence Awards winners 2023

February 22, 2024December 7, 2023 by Lyndal Higgins

We’re delighted to announce that the Lifespan group (Head Office and adviser network) won three awards in the 2023 ifa Excellence Awards held in Sydney, including the ifa Excellence Awards Dealer Group of the Year, for the third consecutive year, and Dealer Group Executive of the Year to Eugene Serravalle. It was a fantastic evening to once again be able to catch up with our fabulous advice community!

To win these awards is humbling and a testament to the strength of our adviser community. We had a strong presence with 22 finalists for these awards from across the Lifespan community. This demonstrates the quality of advice firms that we have in our network.

We would like to congratulate the following Lifespan advisers on both their success last night, but also for being recognised as finalists. We are really proud of our Lifespan adviser community, including the team at CDM Solutions, awarded Digital Advice Strategy of the Year, Kris Meuwissen and the team at Wealtheon, James McFall and the team at Yield Financial Planning, Robert Rich at Unite Wealth, Sheshan Wickramage at Wick Financial, Sangram Rana at Build My Wealth, Zachary Coleman and ZDC Financial, Terry Vogiatzis at Omura Wealth and Suganesh Kuman at YTM Financial Planning, for achieving this well-deserved recognition!

What an amazing result! You can find the winners and finalists here.

Why the interest in index funds?

July 11, 2022 by Lyndal Higgins

An index fund is a type of mutual fund or exchange-traded fund (ETF) with a portfolio constructed to match or track the components of a financial market index, such as the S&P/ASX 200 index. An index fund is said to provide broad market exposure, low operating expenses, and low portfolio turnover. These funds follow their nominated benchmark index regardless of the state of the markets[1].

An index investment fund seeks to deliver a similar return, less fees, as the index it has chosen to benchmark. In its simplest form, an index fund purchases the same shares in the same proportions as its index. For example, an S&P/ASX 200 index fund will hold shares in Australia’s 200 largest companies. An MSCI BRIC index fund will invest in major companies in Brazil, Russia, India, and China. Index funds cover shares, commodities, precious metals, and other asset classes.

With a vast range of indices to choose from, index funds are a useful tool for investors seeking access to both broader and more narrowly focused segments of global investment markets.

The alternative to index (or passive) investing is to either pick individual shares or invest in an active fund. Through stock picking and active trading, active fund managers seek to outperform their selected indices.

Both index and active funds may be listed, in which case units are traded on a stock exchange in much the same way as shares. Or they may be unlisted, with investors buying and redeeming units directly with the fund manager.

What are the advantages of index funds?

There are several reasons why index funds have become so popular:

Lower fees. Without expensive investment analysts picking shares, and with relatively low levels of buying and selling, it costs less to run an index fund.
More tax efficient. Active funds have higher turnover rates of their underlying shares, which triggers more capital gains tax events. Tax paid along the way can reduce the total capital pool on which compound interest can work its magic.
Better returns. Many studies have shown that, on average, index funds do better than active funds. In part that’s because of the lower fees and tax efficiency, but it also reflects how difficult it is to pick winners in the share market.

What are the disadvantages of index funds[2]?

Index funds do have some downsides:

No outperformance. Some active managers do have good records of beating the market. However, it’s difficult to identify who these are in advance.
More risk in a falling market. Index fund managers don’t use stop-losses, hedging, or shorting to protect their portfolios when things head south. Index funds follow the market down, as well as up.
Lack of choice. You invest in the assets that make up the index, even if that includes companies you don’t approve of, perhaps due to poor records on environmental or social responsibility.
They’re boring. Many people enjoy backing their investment hunches, either through direct stock picking or selecting specialist managed funds. That fun isn’t available to the pure index investor.

How can index funds be accessed?

Index funds can be held directly, just like any managed fund. Many investment platforms include unlisted index funds on their investment menus and may also provide access to listed index funds. Public offer superannuation funds that provide a wide range of investment options will usually have index funds on their lists.

What’s right for you?

At one extreme there will always be determined DIY stock pickers with no interest in managed funds of any variety. On the other hand, there are investors for whom index funds provide all the tools they need to construct well-diversified, low cost investment solutions.

Between them is a large group of investors who use index funds to build the foundation of their portfolio, while looking to add some icing to the cake via active funds or share selection.

There are many ways in which index funds may be used to help you reach your investment goals. To find out more, talk to your Lifespan Financial Planning authorised financial planner.

[1] https://www.investopedia.com/terms/i/indexfund.asp

[2] 5 reasons to avoid index funds: https://www.investopedia.com/articles/stocks/09/reasons-to-avoid-index-funds.asp

Index Funds vs. Actively-Managed Funds: https://www.thebalance.com/index-funds-vs-actively-managed-funds-2466445

What is money really?

July 11, 2022 by Lyndal Higgins

That $50 note in your pocket. What’s it worth? “$50,” you say, probably thinking it’s a dumb question. But is it really? Or a sheet of plastic and a bit of ink that likely cost the note printer less than a cent? Your $50 note only has value because the government declares that it does.

This lack of intrinsic value means your $50 note, and the balances of bank accounts that represent most money in circulation, might better be described as currency rather than ‘real money’. For the majority of us, most of the time this distinction is of no great importance, but there are times when it matters a great deal.

Over the past few thousand years, all sorts of items have been used as currency, from shells and cocoa beans to soap and cigarettes. But to be considered real money, several key criteria need to be met. The most important are that it is:

Recognised as a medium of exchange and accepted by most people within an economy.
Portable, having a high value relative to its weight and size.
Divisible into smaller amounts.
Resistant to counterfeiting.
A store of value over long timeframes.
Of intrinsic value, i.e. not reliant on anything else for its value.

Throughout history, gold and silver have come closest to meeting these and other criteria, though nowadays you’ll have difficulty paying for your groceries with gold Krugerrands. Also, you’ll want to keep your gold and silver in a safe place, and it was people seeking to do just that which gave rise to paper money and our current system of bank-created money.

What started as a good idea…

Centuries ago, goldsmiths would take in gold and silver for safekeeping and issue the owners receipts, or notes, confirming the amount of gold held. The depositors soon discovered that these notes could be used for payment in place of the physical gold, making them an early form of paper currency. But the goldsmiths noticed something else. It was rare for anyone to redeem all their notes at once. They saw the opportunity to issue notes as a loan that borrowers paid back over time, with interest. And, because the redemption of the gold was relatively rare, they could create loans worth many times the value of the gold they held. Provided borrowers paid back their loans on time and only a small proportion of owners wanted their gold back at any given time, all was well, and goldsmiths transformed into bankers.

But this didn’t always work out. An economic shock might see everyone wanting their gold back, and if the bank couldn’t deliver the full amount that was demanded, it went broke. To help prevent this, many countries created central banks, with some governments even acting as lender-of-last-resort.

While government control and the rules around banking have evolved over time, private banks are still the source of most currency created today using a process that is much the same as that used by goldsmiths of old. However, gold no longer plays a part. Most countries did away with the gold standard during the 20^th century.

Banks may be better regulated than they were in the past, but that doesn’t prevent crises happening from time to time. Reckless selling of mortgages to people who had no hope of repaying them, then bundling them up in complex financial instruments that multiplied debt was the cause of the sub-prime lending scandal that sparked the Global Financial Crisis.

When things get real

In economically stable times it’s easy to think of currency and real money as the same thing. However, a couple of examples reveal the difference between the two.

One is when a government starts printing money to pay for its programs. Inflation usually results, and the value of the currency can plummet. In the case of hyperinflation, paper money and bank deposits can quickly become worthless as happened in Germany in the 1920s.

And banks still go bust, as Lehman Brothers proved in 2008.

In Australia, depositors are protected by a government guarantee, but this is limited to $250,000 per person per Authorised Deposit-taking Institution (ADI).

In both situations ‘real’ money such as gold retains its intrinsic value. All else being equal, if a unit of currency halves in value due to inflation, the price of gold will double. And provided gold is stored securely, it can’t be consumed by the debts of a mismanaged bank.

The difference between currency and real money and the issue of intrinsic value has implications for other investments. If you would like to learn more, talk to your Lifespan Financial Planning authorised financial adviser.

Lifespan Invest digital investing and education solution to address the ‘advice gap’

June 30, 2022June 7, 2022 by Lyndal Higgins

Lifespan is pleased to annnounce the launch of our digital investing solution, Lifespan Invest, as a means of reaching the mass market of Australians priced out of receiving personal advice.

Consumers who sign up will not receive personal advice but can elect to have their investment portfolio professionally managed for them, and will obtain access to a regular feed of financial literacy and educational content in the form of engaging articles and videos, helping them to lead more successful and fulfilling financial lives.

Lifespan Financial Planning CEO, Eugene Ardino, said the company was proud to be taking proactive steps via a digital solution to seek to address the needs of Australians who would like professional assistance.

“In an ideal world, every Australian would be able to afford a personal financial adviser, however, the reality is that delivering personal advice has become increasingly expensive over recent years, inevitably excluding more and more people. Yes, the Government can take steps to reduce much of this cost by streamlining regulatory requirements – and we are extremely supportive of the Quality of Advice Review currently underway – however, the industry needs to also utilise robust and compliant new technologies to help address the growing “advice gap”.

“Our advisers are now able to offer an alternative digital solution for those whose circumstances are such that they do not need to go through the more expensive personal advice process. When they do need that service, our advisers will be there for them”, Mr Ardino explained.

The Problem – and its Solution

Mr Ardino called on the rest of the financial advice industry to look to new technologies to enable them to reach and help mainstream Australia.

“The press is doing a great job in highlighting the size of the problem – thousands of advisers continue to exit the industry every year, and as a result, it is estimated another 100,000 Australians over the past year were “orphaned”, that is, had their advice relationship terminated. The problem is clear – but equally, there are now digital solutions to this problem, and it’s up to the industry to embrace these new technologies”.

The Lifespan Invest solution is provided via a partnership with Melbourne-based fintech platform, OpenInvest.

OpenInvest CEO and co-founder Andrew Varlamos said the company was excited to be partnering with an award-winning dealer group in Lifespan Financial Planning.

“The team at Lifespan understand that everyone is better off when they can access expert and professional help and are now – via OpenInvest technology – able to reach a much larger audience with their expertise. The current advice gap will only be solved by a combination of scalable technology and progressive financial advice firms such as Lifespan working in partnership”, Mr. Varlamos said.

Financial Wellbeing

Mr Ardino echoed the theme that being able to access trusted financial expertise helps people to lead more successful and happier lives.

“For a variety of reasons, increasing numbers of people are experiencing financial stress and uncertainty. And because the banks have all exited financial advice – unless you’re extremely wealthy – it leaves an even larger vacuum that unfortunately has been filled with a spate of gimmicky trading apps that encourage people, especially young people, to gamble via share trading or crypto. Not only does this pose excessive risk of financial loss, but it also comes with inevitable mental anxiety and stress.

“There’s sensible investing and there’s speculating, and we see it as our role to help Australians invest the right way – via managed, multi-asset class diversified portfolios. By doing so, they are more likely to reach their financial goals, and also achieve a greater sense of financial self-confidence and wellbeing,” Mr Ardino explained.

Find out more about Lifespan Invest here.