David Ruddiman has long been an advocate of self-managed superannuation funds (SMSF) and credits his focus on the sector and long-term client relationships as keys to the success of a business that hasn’t lost a client since it was established.

Ruddiman, originally a bank planner, says he was prompted to start up his own business – Professionals’ Choice Wealth Management – five years ago after growing tired of the product focus of the institutionally-owned distribution chains. “I became very disillusioned very quickly with the product flog and chose to leave NAB,” he says. Even during his last days at NAB Ruddiman pushed his employer to allow him to move away from the traditional trail commission-based revenue model. “I was one of the first advisers to move to fee-for-service but it didn’t sit well,” he says. Professionals’ Choice charges on a fee-for-service model and where possible the practice rebates and refunds commissions. Ruddiman initially started up his practice under the auspices of ABN Amro Private Clients but took out his own licence in March last year. He is currently the sole financial planner in the business but works alongside two accountants and one analyst. However, in January next year two more advisers, one with legal experience, will join the group. The practice focuses on the sophisticated high net worth individual and its average client has $3-4 million under advice. As such the majority of clients have investments in direct equities, structured products, instalment warrants and derivatives. Over 60 per cent of Professionals’ Choice clients have an SMSF and it was always Ruddiman’s intention to specialise in that area. “We see SMSFs as being an integral part of any wealth creation strategy for high net worth individuals both pre and post retirement,” he says. The business does not advertise and all of its clients have been referred by existing customers. Running his own practice has let Ruddiman focus on effective wealth creation strategies for clients and he is critical of some bank-owned distribution networks which require planners to fit their clients’ needs to a limited recommended list. “We have a very very big commitment to standards and to a long-term client relationship,” he says. The initial client meeting is spent discovering an individual’s wealth creation needs and the subsequent visit is usually spent discussing and putting in place strategies with specific products often not mentioned until the third appointment, according to Ruddiman. An investment policy statement is then drawn up for the client, which is in addition to the required Statement of Advice. David Ruddiman’s long-standing repute in the self-managed superannuation fund led to him being approached by the SMSF Professionals Association of Australia (SPAA) when it was established two years ago. He sits on SPAA’s board and chairs its regulatory committee. Professionals’ Choice recently brought its SMSF administration and accounting in-house with a badged version of Praemium. The group previously used investment platforms MLC MasterKey and Macquarie Wrap but has also brought that in-house for cost reasons. As 60 per cent of clients’ holdings are in direct equities Ruddiman believed platforms were only adding an extra layer of fees and by bringing the service in-house with the bagded Praemium clients have achieved savings of between $6000 and $20,000. “How hard can it be to administer direct equities? Why should the wraps get fees on an asset-based structure,” he says. Professionals’ Choice also employs its own analyst who interprets research sourced from Aegis and van Eyk and overlays it with research from brokers Credit Suisse, UBS, ABN Amro and Citibank to see where it deviates. With the addition of the two new advisers Ruddiman expects to spend the next 12 months focusing on his own business’ future. Succession planning is also on the agenda but Professionals’ Choice may go national before then with the group also looking at opening up offices in other states. Name: David Ruddiman Business name and location: Professionals’ Choice Wealth Management, Brisbane Dealer name or self-licensed: Self-licensed Number and designation of staff: 1 planner, 2 accountants, 1 analyst, 4 support staff (2 more planners joining in January) Relevant Qualifications: DFM, DFP, SPAA SMSF specialist accreditation FPA member: Yes Number of clients: 126 Funds under advice: $168 million Method of fee collection: Fee-for-service Investment platforms: Previously MLC and Macquarie but recently brought in-house. Praemium for direct equities Investment research: van Eyk, Aegis, UBS, Credit Suisse, ABN Amro, Citibank plus in-house analyst Front-end software: No provider, uses in-house system developed on MS Access

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