Adapting to Financial Planning's Future with Wessel Oosthuizen

So grab a coffee , sit back and let's get ready to blast off . I'm your host , françois D'Itoy . Yes , I almost started again with good morning . Good morning . It felt like the start of the show . This is the main sequence . So , vessel Ustazen , a massively warm welcome back to the show four seasons later .

A lot of the things that we've done over the years in propulsion even before it was called propulsion was because of conversations that you and I had . So obviously I have huge amounts of respect and I see a lot of value in this . So let's get into the conversation . Really excited to be talking about this . Just briefly , what are we going to be talking about ?

So we're going to talk a little bit about the evolution of financial planning . Of course , there's been an incredible event . Vessel sent me a picture last night .

I wish I could show it , but it was a picture from days gone by that somebody just happened to send to him about , you know , when they were starting to push or let's say , starting to , but they were pushing financial planning and all of those things . It's quite an interesting thing .

And he said to me like yes , things have evolved quite a bit , which is amazing . We're going to talk about that . We're also going to talk about sort of how does the psychology of financial planning intermingle into everything , because there's a big focus on that at the moment .

And then also , you know , if we think about one of the things that I definitely want to talk to Vessel about this morning , because he's got direct experience and personal experience around this is how do we work with clients when they contract something like the main shop , for example ?

We want to talk a little bit about that , and then , you know , I'm going to throw in something about tech , vessel , and then we're also going to talk about the future , we're going to speculate a little bit . So , if you're happy , I'm happy , and let's start off Vessel with you know , I mean , you've , you've , you've , you've .

You've been around since the early days , if not from day one , when it comes to financial planning . I'm quite keen to sort of just hear you know , what have you ? How has things evolved since then ? And , I think , more importantly , how did financial planning start in South Africa ?

who are you ? And I always said vessel from Dorst . Now , dorst was the name of our farm and that means that's a Dutch word for thirsty . So I'm still just vessel from Dorst . So , but , thank you Anton . Yeah , you know it . It .

It takes me quite well back and let me let me start with with a story , and I think sometimes when we talk about evolving our financial planning , you know , evolving is not something sudden , something big . Evolving is gradually , it's over time , it's over decades .

Even I , just to start , before I go into some of the history , I read an article this week published in , I think it was said , by CityWire , about how advisors and CFP professionals some of their views on how we evolving as a profession in South Africa . You know , and and what I've picked up .

Some say it's very slow , some say not , a lot is happening , and I think our friend Quirbus was also one of them and he's always positive about that . Alright , then I realized that what we missing is the shoulders of giants in the past , that we're standing up and where we are as a profession .

So I can , I just got involved with financial planning in the late 90s and 98 . There about Francois , it was still known as ILPA before the Financial Planning Institute of Southern Africa . And it was so interesting for me the other day to listen to the story of the then CEO of what we know now as FBI .

How he went with I think it was Peter Neavote , and they included Andrew Bradley in the discussions because of his travels overseas and his knowledge about the United States and Australia and so on . And they realized at that stage , you know , they need to move away from ILPA .

Those days it was known as ILPA and not because ILPA was the way or not the way to go , but because they wanted to professionalize it . So they traveled to the United States , francois in 98 and they wanted FBI to become involved with the global community .

And you know , what was so interesting for me is when they returned and they had to almost sell this thing called financial planning and we're talking now 97 , 98 to the community , to the ILPA community . I think it was what it was the insurance , life and pensions Association for it seems like a lot of people were upset .

You know what is this thing called holistic financial planning and profession and so on . Yeah , so if we tend to forget about those days and those people that that became for before us , but from show that the one thing , that almost the golden thread that I picked up up till now is that knowledge , knowledge , knowledge is the founding principle .

That's number one and number two , it's a coat of his ethics and so on . And when this started with in 2001 , with formal education and having a postgraduate diploma , I think that's where all started in South Africa and where people can be , you know , educated and also understand .

And I think everything to evolve , you need to start with knowledge , and I so , like you know , when I became involved internationally I think it was about 2004 , five with the financial planning standards book I mean , we're talking here 20 , about 18 years ago there was this it was amazing to me this whole concept of certain fight financial planners and about

financial planning , but they were not even or was not even a proper definition of financial planning . For what is financial planning ? I recall in 2006 , I sat with the standards committee and other committees where we developed standards and what is this thing called financial planning all about ?

And in late 2010 , 11 and 12 , where we sat and we struggled with the concept . What is the body of knowledge ? You can't become a profession if you don't have a body of knowledge , and we had numerous international meetings .

I recall wanting to buy where we had an and I chair that , where we had over 20 plus people that over the world that we struggled with this concept . What is the body of knowledge ? From sure , and to think back , it's almost if I may compare it to the smartphone 2006 , you know , I think it with when Apple came out with the third iPhone .

It's just the other day . It's almost when we really started to develop internationally the , the concept of financial planning , and there were major jumps and and others providers that came on board developing the cell phone .

But nowadays , you know , it's a better camera and it's maybe the body that needs change , but it's the apps that they add and so on , and that's similar to to financial planning and our profession and I think that's what a lot of people must is we've got a good structure , we've got a code of ethics , we know what financial planning is and it's now about , and

I love what they brought in and when we worked on the new standards and I think actually is the fenter from South Africa brought the concept in and that was a concept that they introduced in Harvard when they research business schools about knowing , doing and being , where it's not about the knowledge but also the ability to use the knowledge , and I'm very excited

because introduced last year in March in the standard something called psychology or financial planning . So that's why I think when I read that article one is a little bit disappointed because I think they're right , there's small little changes .

It seems like the world of financial planning is not massively evolving over a short period of time , but it's because the foundations are so solid at this stage .

So it's quite interesting to sort of learn that from you and to say , well , just as you were talking , I'm just thinking about that's the other day , it's not even , it's still a teenager , sort of sort of going through the motions , and it excites me at the same time , because there's so much that can still come and , as you say , because the foundations were

done correct , it might take feel slow . It's like , yeah , it's like my iPhone , it's like when the 15 and the 13 and the 12 and the 11 , they all look exactly the same . You know , it doesn't even feel like you have a new iPhone , apart from it's a little bit faster and it's a little bit better pictures and stuff like that , you know .

But still , it's the , it's the evolution , and so those little changes that compound over time as well , you know . And and the other thing is is also , you know , it's sometimes when we sit and we just view what's happening versus we actively involved in shaping the profession .

There's also a massive difference between between that , you know , playing the game in that sense and sort of being on the stands and saying like , are things getting better ? Are they not getting better as well ?

And for me , you know , one must always think about those as well , like how much are we contributing as an individual to the profession , not just from doing the work but from actively brainstorming these things and participating in these kinds of sort of brainstorming sessions ?

Well , yes , it started in the early 70s in America with about 40 odd people , but even internationally , you know , it's 50 years or so old , so so I think that our profession will actually really kick on and evolve when some of the next generation comes through and add to this lovely profession of ours . Sorry to jump in there .

So I'm really keen to sort of maybe just just whether you'd like one or two or three , like over many but very specific events that you can recall , maybe in this journey up to where we are today , that really stood out for you , that you thought like , well , this is kicking things up again .

This is kicking things out specifically from a South African point of view .

with them . You know that we're going now a financial planning route . There was even a gentleman , gates , mr Gates , that traveled to the conferences in America and he brought back what we currently know as CPD .

It was not a well known thing , you know continuous professional development but , francois , I think what really kicked our profession off and I already mentioned that is starting with a official program recognized by SACWA . I really do think that's and then developing the body of knowledge that's in any profession that helps the profession to involve and to

share . It might be a story with you 2004-2005 .

Three , four years into this postgraduate diploma was then involved with the University of Pre-State and I recall in our examinations where we tried to assess this thing and remember this was now the early days , you know we were still , or people were still , much on the product side and selling and we asked time value of money questions , and people struggled with

that and I realized but we need to bring into the curriculum how you calculate so that people understand , and it sounds so basic nowadays , you know , and , and what I also did , you know .

Another story that I would like to share is that I was invited 2006 , I think to LA in America to attend as a panel member , and just before that I've listened to another conversation .

It was the universities in South Africa , in America they will already then over 30 , I think universities in America that teach financial planning , and the one person talked about behavioral finance . So that's about 18 years ago now and I thought what is behavioral finance ?

It's the first time I've ever heard about that and the more I've listened I realized that we need to include it in our curriculum . And those days , luckily , I was in a position to make those decisions and the next year behavioral finance was included and it's so .

It's again education and it's again some you know , like CPD , some things that we see , some things that we experience , and I think the current major thing that that's introduced is the psychology of financial planning .

But I will like to warn , I think some people you know we must remember there are people that's making a living out of that and people that's writing books about that . We not therapists , francois we need to use the knowledge of psychology or financial planning . You know , understand our clients , understand the conflict of money in our clients life and so forth .

You know , and yeah , so I will say those things are the things , and I think the psychology and even coaching , it's not to become coaches , it's still to remain who we are , through to our core as financial planners .

I've last year taken a coaching course at UCT because I realized when I recorded myself is I'm talking about 70% of the time and the clients 30% . It's not the way to do financial planning . We need to listen and tour our clients , francois . So what excites me is actually is these little changes and the psychology of money .

What I said is that we're always good with working with the client's money and there were some of us that's very good at looking at the client's life and you know , stress factors in their life and conflict of money between the spouses and so on .

And but what this includes now is also the attitudes , the beliefs , the behaviors of clients , and if we take that into account , you know it changes the world .

You know what , in my research for the FBI refresher , looking at things , I also thought that you know find psychology or financial planning is not an American thing , it's not a European thing , it's not an Australian thing . We must find out what that means for us in South Africa , for the profession in South Africa .

And then I started to go through surveys and read up on these excellent survey that was done by the FECA on financial literacy and things that stood out from that Francois was things like we're quite a materialistic nation and you know also the differences between married people and unmarried people , the differences between our provinces .

It was just amazing and I realized we must be careful to read through psychology or financial planning in these notes and use that generalized terms on South Africa . You must still know your client and you must realize that clients may differ and the culture , the environments they come from may differ .

Yeah , I'm talking out too much Francois , but yeah , I'm excited . I'm excited and I'm not a psychologist even .

We've got transitionists and we've got all sorts of different aspects that that's looking at . You know various aspects of this or all that incorporates various aspects of this , but I'm quite keen just to sort of maybe hear some about . I mean , you've already shared a couple of ideas , but are there other things around the psychology of financial planning ?

Because I think you mentioned a very important thing just now is that you know , get the knowledge , but we've got to look at it through a South African filter and we've got to know you know sort of what are the nuances that's at play in South Africa specifically . So it's not as simple , as you know , and I'll please say this with the greatest respect .

You know , just doing like reading the book , doing the course and then happiness . There you go . There's a lot of things that needs to go into that and to think about how do we apply it in South Africa . But I'm keen to hear , just you know , do you have any ?

What are some other aspects that maybe you feel is really important when it comes to psychology or financial planning and also , together with that , whilst you're talking , you know and sort of sharing that just how do we get started in that direction , to sort of upskill ourselves on that ?

These two of our financial planners , social financial planners , youngsters at our firm that have attended the FBI Psychology or Financial Planning course and we've got every Monday a financial planning forum and where we can share things and every one of our financial planners or para planners does get an opportunity to present something and Lana and Duane is now once a

month approximately . They will present to us what they've learned there , and I was a mate .

You know the tools that you get and you know I loved the last one that Lana did with us is that you draw an egg on a page and that you fill in your historical money memories in that good or bad and that opens up a discussion , it makes your client think and so on . But I think we must be careful .

So I will say you need to start with doing some sort of a course that you just get your mind around it and the knowledge . And I think Psychology or Financial Planning is much simpler and I do think that most of us does have the principles . And let me explain to you .

Wenkin talked about the happiness curve and she talked about just over 50 and we've seen the curve going up . It made me think that I'm now September will be 56 . And I realized that my dad was also vessel .

My dad died at just two months before his 57th birthday of cancer and I realized but you know , I'm about a year from that age and that is if you know your client and they share the story of their father dying of cancer at the early age and you can explore that with them . Did that change their lives and how does that affect them ?

Or let me use and we will come back later to my mom and it was amazing when we did the Refresher Franchois where my mom was diagnosed in 2018 for those that don't know with vascular dementia . She was still in private and but I realized you know she's all alone in private .

Vessel is the only son and we need , in a way , you know if she deteriorates , you know how will I be able to look after . So that was almost a two year phase together into Cape Town and she's now staying with us a room or two away from from year .

But it's like when you deal with a client and their mother or their dad's got dementia or a client that's got the fear of dementia , it's just be a pure human being with empathy , listening to what they're afraid of , listening to what they're scared of .

You know , just to share maybe with you , myself experiencing now is that we will sit in the evenings and watching binna lunders you know it's a soapy of Cape Dead Franchois , not that I love , but I will do it with my mom because that interaction and then we will after that watch these turkeys' sopes and you realize , you know , that from one scene to another ,

that mom is not realizing that it's the same act also . So short term memory starts to go . So If you know your clients , if you know their values , their beliefs , the things in their lives , the events in their lives , it makes it easier at Francois .

So that's the psychology of financial planning is just be caring about that person and listening and then use your skill as a financial planner to help them to sort out those lifestyle issues so that you can prevent .

There's one thing that , talking about the psychology of financial planning , which I was amazed at , and that's maybe the last thing that I would like to share , is last year the financial planning standards board did a global study of over 15,000 clients , of financial advisors and non-clients .

So over 15,000 , and it's about 27,000 , I don't think all the countries participated , 1,000 from South Africa . But , francois , what was amazing from the results of that is how we as financial planners , by just doing our job as a financial planner , we create well-being in our clients' life and them feeling better about themselves , feeling better about their money .

And I mean some of the stats and let me see if I can quickly give you some of the stats here and for me , that link that even we're not there to help clients with well-being or focusing on that .

It's an amazing outflow of us doing a proper financial planning job listening to our clients about their history about and keeping in mind their religion , their culture and so on . I mean things like quality of life and I'm just going to share one of two with everybody is I generally feel active and have plenty of energy .

Now they've assessed people without an advisor , people with another financial planner that's not a CFP professional and CFP professionals , and 56% said I generally feel active and have plenty of energy without an advisor or people don't have a link to an advisor . 63% with a financial planner that's not a CFP professional said yes .

70% with a CFP professional assisting them said yes . It's a question that's not even related to finance , francois , and things like my interest and involvement in life give me a sense of meaning and purpose . All these things I generally feel positive and optimistic about life .

All these things people that are at a CFP professional in their lives supporting them came out much higher in percentage than the other . And the last one that I would like to share , that's on the quality of life , is financial confidence . Let me share the first one with you .

I feel I have enough money to last the rest of my retirement that I will be happy with , and without an advisor . 75% said yes with a financial planner , cfp professional . 87% said I have enough money , almost like Kim said gratitude that you sorted and that's I mean .

That's exciting because that's how we it's a value that we're adding , and I don't think we're sitting here listening to Vessel and Francois conversation realise this important role that we're playing . But yeah , I think that's enough on the psychology of financial planning . That's brilliant .

I've got Chris Bums , so you'll be happy to hear that we don't have enough time to talk about technology , but I do want to ask you a question that we actually ask in the financial planning master clause to all our guests .

So the financial planning master clause is a session that we run in propulsion and but the one question we ask everybody is this and you weren't prepared for this , I'm throwing this at you and let's see what you have to say about this .

So let's just say you are cleaning out your garage or one of the rooms , you know , and you see this little lamp there in the corner and it's like , oh , what is this ?

And as you wipe it off , out comes the Lonnie beside , the genie of the financial planning profession , and she says thank you very much , you know , for getting me out of the stuffy lamp , dear Vessel .

And she says , vessel , to thank you , I'm going to give you three wishes , but here's the crux , or here's the catch that you can only use these wishes for the financial planning profession . So you can't use it for yourself , you can't use it for anybody else , only for the financial planning profession . What would those three wishes be ?

She said you know , when my world's car is too high , you always say take a scissors and take the car and just do that . So I do use some cutting edge technology . But let's get back to your question . For me there's two or three things that stands out . For me .

There's always a passion about the next generation and what I realize is that we're not putting the young people in a position to take over from us , to become the next financial planners , to support them , to give them the structure we're all so busy .

So one of my wishes is let's mentor the youngsters , let's help them , let's give them the power to step into the shoes of us , with our clients and so on . So that's the one thing , that . The second thing is that for me it's we need to become and need to get the CFP professional numbers up . Why do I say that ?

If you go and look at people advised by CFP professionals and I've touched on earlier , people not advised . We play a major role in clients' lives , in helping them in their well-being and so on , but to do that we need more CFP professionals .

We're only four and a half plus thousand just under five thousand South Africa of which two and a half , I think , is practicing . How do we get more people in to support ? Why are we so struggling in this country ? Francois , when I went , I've gone through surveys and people struggling to retire . Let me share something with you .

There's a material value scale , also a survey that we've done where they highlighted 50 of those socially needs that people will like to see . People put cell phones number one and then the rest is things like electricity , warm clothes , warm cell phone number one . How do we change this concept of that ?

People said in that survey and I would like to end off with that is that when they are 16-22 , people said that we aspire to . Next year we want . 84% of people said we want cell phones . It's essential . The following year , when they say that , 98% had cell phones . When they asked the same question about savings , 74% said next year we want to save , 74% .

Next year . Only half of that 37% saved . So we need more people on the ground . We need more financial planners that want to do it for the client , Putting the client first , helping them . Francois . I think I've only used two of my wishes , but there you go . Those are my two wishes .

So I'm just preempting . People can connect with you on LinkedIn , but , vessel , thank you very , very much . Brilliant conversation . I can do this for the whole day , but thank you very much for your time , thank you for everything you've done , thank you for everything you keep on doing and for shining the light brightly on this amazing profession .

So thank you very much . Thank you , fantastic , fantastic , what a show . Thank you very much for being here . Really appreciate it for all of you . These are that much light falling over my words

. We'll be back next week , same time , same place . Do keep an eye on our socials and what we will be sharing and with that we can stay safe , be blessed and prosper and continue . You know that . Continue to raise the body , have your locks bye , alright , folks . That's the wrap for this episode of Propulsion .

I hope you got as much out of this as I did . Remember to tune in every Friday at 8am South African time for our live show called Propulsion Live . You can find it at wwwpropulsioncoza forward slash live and trust me , you don't want to miss it .

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