According to Adviser Ratings’ Q2 2024 Musical Chairs Report, the latest quarter saw more than four advisers exit for every new entrant, noting a 1 per cent decline in the total adviser population, despite 95 new entrants, landing at a total of 15,415 at the end of the quarter.
Notably, this period covers the end of the 2023–24 financial year, which, according to Wealth Data, saw a net loss of 159 advisers from 21 June to 4 July as advisers dropped off the register before the new financial year. The adviser population is now sitting at 15,497, as of 8 August.
“As the federal government charged ahead with reforms to make advice more affordable and available, adviser numbers remained stable at the start of the new year. It’s the fourth consecutive quarter in which we’ve seen little change in the adviser universe, which is a welcome trend after losing more than 12,000 advisers in a few short years,” the report said.
“Adviser Ratings expects this optimism to continue, with our data indicating advisers are investing in their businesses and being rewarded with higher levels of profitability and revenue.”
Looking at licensees, the report found that nine in 10 (89.8 per cent) are now listed as privately owned, with 81.9 per cent of all licensees having 10 or fewer advisers and more than a quarter of advisers (27.3 per cent) operating in these firms.
“As we’ve seen in previous quarters, licensees existing outside of the private universe lost a higher proportion of advisers than their privately-owned counterparts. The already-tiny limited licensee segment contracted 4.6 per cent, while the diversified segment fell 4.5 per cent,” the report said.
During the quarter, 440 advisers (2.9 per cent of advisers) switched licensees, a notable decrease on the previous quarter which saw 520 switch but following a similar trend to the previous year in which 491 switched in the first quarter and 418 in the second.
According to the report, this is one of four quarters since the beginning of 2019 in which there have been less than 500 licensee switches, the fourth occurring in Q4 2022 with 451.
Practice make-up within the profession remained relatively similar to the previous quarter, with more than half (3,280) of the 6,058 licensed practices operating with a single adviser. This was followed by practices with between two and five advisers at 1,675, and more than six advisers at 248.
Alliance Wealth saw the most growth in adviser numbers during this quarter with a net gain of 12 advisers, though a notable drop from its net gain of 29 in the previous quarter. This was followed by QInvest Limited, up eight advisers, and Vincents Advisory, up seven advisers.
Merit Wealth saw the greatest reduction in advisers with a net loss of 21, following a net loss of 10 in the previous quarter. This is followed by AMP, down 19 advisers, and Sunsuper Financial Services, down 18.
Adviser growth within licensees was notably more stable during this quarter with a difference of net 33 advisers between the licensees with the most growth and most loss, compared with the 99 adviser difference in the previous period.
Additionally, there have been 39 new licensees and 53 ceased in the 2024 calendar year – a net loss of 14 licensees. Of the 18 commenced in the latest quarter, eight had a single adviser, seven had between two and five, and three had more than six.
These results are catastrophic and NOT to be celebrated, the profession is still dying T an alarming rate. Net lost of 159 advisers in under 3 weeks and 4 placing for 1 joining. Disgusting government/regulator and industry fund mafia driven culling of independent advisers.