VISIS Private Wealth adviser and winner of Rookie Adviser of the Year at the 2014 ifa Excellence Awards, Stephen Godfrey, said that the difference between the two is so staggering that he believes they are almost unrelated.
“I see a case where we’re moving towards having two completely separate industries. We’ve got one that’s bank and aligned and then we’ve got independence,” Mr Godfrey said.
“I believe there will be a time where you can’t even look at them as the same industry really.”
While some have sounded a death knell for non-aligned and boutique advice, Omniwealth managing director Matthew Kidd said its future is “well and truly alive”.
“If you think about it, only a year or two ago we were reading in the papers how it is going to be the big institutions, the bank-aligned groups that are going to take over the world when it comes to taking over advice, and the small independent boutiques are going to struggle to keep up,” Mr Kidd said.
“I now think it’s completely the opposite.”
Do all ‘independant’ advisers always provide good advice and equally, do all ‘aligned’ advisers provide bad advice?
I think not.
Does a Bank planner (employee) of some 15 years standing, provide better advice than an ‘independant’ adviser with only 2 years experience?
Perhaps
Broad generalisations are frankly, pretty vacuous really. Having spent many years in the industry & seeing many, many advisers…the bad un’s could be found everywhere….as with the good ‘uns.
In the end, the key issue about good advice is about the culture of the AFSL / dealer group.. which invariably dictated how and what advice was delivered.
If the senior management of a Bank’s AFSL turned a blind eye to compliance issues or a one man operation put every client into geared investments….
well….it is what it is.
Well said Dave,Patrick yells, another mad planner well isn’t that just so lovely.
They tar everyone with the same brush and believe blindly their way is the just way.
Dave, I am sure you are a great planner and coming from IFA land, I know I too would continue to do the same things for my clients as I do today, even if I was in bank land. I don;t have a problem with planners like yourslef. I do, howwever, take issue with planners from bank land that position themselves to prosepctive clients as being independent (because they run theie own business) but also say they are financailly solid due to having a bank behind them! You can’t have your cake and eat it too. That is why clietns should know who ultimately owns/licenses planners. It’;s good for consumers as they will be happy havinga bank behind them, or that the advice being provided is not influenced (rightly or wrongly) by a parent license.
It all comes down to who controls the money direcly (who receives the fees). non-aligned get fees paid directly to the AFSL (of which they are shareholders) and aligned get it from the parent AFSL, who is contracted to pass it on.
Patrick, you know little about our bank. I am running my own business, I am an equity holder, I run a profit and loss and incur the expense of overheads and share in the profit. I recruit staff, do strategic business planning, have skin in the game, etc. Further, I am building an asset through the value of my equity too. There is a difference between the level of ownership and control I have versus a self-employed IFA, but please don’t mistakenly think that I just work for wages and have no ownership, responsibilities or involvement beyond seeing clients. The lack of understanding in IFA land of the best bank models and the quality of their businesses and advisers is unfortunate. I come from IFA land and CHOOSE to be here, it’s better.
Dave, WITH ALL DUE RESPECT YOU ARE NOT RUNNING A BUSINESS, YOU DO NOT OWN ANYTHING AT THE BANK, YOU DO NOT RECRUIT AND PAY WAGES FOR YOUR OWN STAFF,you do not pay rent on your offices or loans if you have purchased your own business premises,you are not even coming close to running a business,we do this and ten times more as well as being a Planner, oh i nearly forgot! yes we are building a business for ourselves a valuable asset yours to sell when you choose, see Dave you dont even come close! sorry.
[quote name=”Dave”] and I know this because I win countless deals from other planners (inc. IFA’s)[/quote]
This here ^ is why you are not in the top 10% because you look at it as winning deals and not a client that yo value and respect with a view to a long term mutually rewarding relationship.
Just my 2c
You are generalising too much. I agree that on the whole, many bank planners don’t make the quality cut, but nor do many IFA’s. I am a bank planner and would consider myself in the top 10% of all planners as far as quality of advice and level of service, and I know this because I win countless deals from other planners (inc. IFA’s) and most of my business (in spite of being in a bank) comes from existing clients who refer people to me. On any measure (service, advice, business acumen, etc) I would easily stand above most IFA advisers. I CHOOSE to work for this bank, where I have complete autonomy to run my business as though I was an IFA, NO sales pressure, exceptional resources, etc. The quality of any planner needs to be judged on merit and where they work is irrelevant. I agree that on the whole, IFA’s would generally be better advisers than most RETAIL bank branch planners, but this is not without exception. Our Business Bank planners are exceptional.
There is absolutely not doubt that aligned planners – those working in bank branches or linked to industry funds are pushing product not providing holistic strategic planning advice. A distinction is most definitely required.
I think a better distinction is between ‘financial advice’ and ‘product sales’. Denying any properly incorporated business to access to equity capital will simply cause further distortions. My view is that there is little correlation between the share ownership of an advice business and the quality of advice provided.
Don’t agree. The average Joe in the street doesn’t even know what you are talking about when you say ‘non aligned’ or independent. We get too caught up in this argument. Look at the building industry. Do I go with Metricon or a custom builder? Up to the me but I see them as part of the building industry. We need to stop this us versus them mentality. I think generally people don’t care. All they see is the industry squabbling with each other and think we are full of self importance.
I could not agree with you more, there is a huge gap in the advise process between those in the IFA world where in the main they are responsible for steps 1 thru 10, as someone who has purchased four client books over the last fourteen years and hired lots of planners i have not yet found one bank planner who is capable of steps 1 thru 10, that is possibly because they only do 3-5 of those ten steps, others on the conveyor belt and the product flogging sausage machine do the rest, yes lets seperate totally! and the sooner the better.