The number of financial planners that will leave the industry over the next six years “cannot be understated”, according to a business broker specialising in accounting and financial advice firms.
Connect Financial Service Brokers chief executive Paul Tynan said mature age planners, education requirements, demands of the industry exam, the demise of Dover Financial Advisers, the royal commission, grandfathering, and excessive compliance and regulation will be a “perfect storm” for the advice industry.
“Added to this scenario is a total lack of understanding and appreciation of the role and importance of the advice sector that will see an exodus over the next six years of more than 50 per cent of the current force of financial planners,” said Mr Tynan.
“The timing of this self-inflicted disaster couldn’t come at a more inopportune time for the Australian economy and financial services sector as the need for professional advice will significantly escalate as the Baby Boomer generation moves into retirement.”
Over the next four decades, Mr Tynan said, there will be unprecedented demand for new channels of advice in aged care and residential living, assistance with social security and pension requirements, estate planning, exit and succession of SME business owners and self-funded retirees, who will all be looking for professional skills and advice services.
“I predict that face-to-face advice will boom for those businesses that are left as mature age consumers will prefer not to entrust their futures and nest eggs to robo-advice or other AI generated advice platforms,” said Mr Tynan.
Unfortunately, this much needed [face-to-face] service will be limited to the 20 per cent of Australian consumers [who] can afford it. The remaining and vast majority of consumers will have no option but to revert to robo-advice, new digital advice platforms and social media.”
With all of the incoming changes, he thinks the planning industry will struggle to attract a new generation of advice practitioners, as “the sector will be competing with other industries that have far more attractive employment and career opportunities”.
“The financial planning industry has immense brand damage and a long and complicated pathway in order to become a fully qualified [adviser],” he said.
John smitt must be having a laugh. How much dodgy smsf advice have accountants provided in the persuit of audit fees, especially in cahoots with real estate agents to push property inside smsf. This will be the next big blow up in financial services and destroy what little credibilty accountants have left.
Given we have a Royal Commission investigating the corrupt and unethical behavior of financial planners I think you will find that accountants have more credibility then Financial Planners.
It’s time for accountants to re-enter this area. We don’t have to be told to act in the client’s best interest, it’s what we do. We are independent of financial product providers, lenders, insurance coys. We do the clients’ tax returns. We can have a 30 year relationship with clients for all their financial affairs, & build their wealth, plan for retirement, while they pay the minimum legal tax. If only the Federal Gov’t will allow us? Time for lobbying, this time effectively by the so-called professional accounting bodies.
Mate, unfortunately not all are like you. Many dodgy Accountants look the other way to line their pockets.
And many dodgy Financial planners line their pockets by charging dead clients, collecting trailing commissions and pushing clients into unsuitable investments that paid higher fees.It is ironic that the same people who insisted that accountants, who were degree qualified,complete additional training are now complaining about having to get university qualifications
Your university qualification probably doesn’t count — that is what the majority of the complaints are about. I have an accounting undergraduate degree and a Master of Commerce and don’t appear to have a University degree which is suitable to FAESA.
John Stitt, please can I have a SMSF without advice and roll over my $20k in an industry fund and cancel the insurance at the same time? If not from you I’ll go to your mate down the road who will do it.
Don’t forget – without a licence it’s against the law to even tell the client they should NOT do that.
Just refer it to one of the digital advisers. It’s easy. The rest of what an SMSF accountant does requires no AFSL – tax advice, compliance advice, factual info.
Limited licenses are a ridiculous idea.
Don’t forget without a License most accountants just provide advice anyhow and even those with a License don’t do the required AFSL compliance
It wouldn’t be against the law to tell a client wanting an SMSF that a) ASIC recommends a minimum of $200,000 and b) industry fund may have insurance that would be cancelled if the account is closed. Both statements are facts. Add a disclaimer and a statement suggesting the client gets independent financial advice. It’s ridiculous that an accountant has to be concerned about the laws that they would say nothing especially as there is the also laws regarding negligence.
Good