In an address to the annual Financial Services Council Summit yesterday, Mr Wade noted the wave of departure from the advice sector is expected to place around $900 billion of client wealth into play over the next five years.
“The most immediate and significant challenge for leaders in the wealth management industry today, is to come up with a solution to deliver compliant and affordable advice for the masses,” Mr Wade said.
“And we must do so while navigating this period of disruption, regulatory scrutiny and market dislocation. Because today’s advice, while valued by those who can afford it, is too expensive for most Australians.”
He noted there is a growing need and demand to build an advice solution that is “life led”, helping consumers at key moments when they need advice the most, such as investing an inheritance or redundancy, better managing their super, or paying off their mortgage.
“This is a new kind of advice to help those Australians that don’t need or can’t afford holistic face-to-face advice,” Mr Wade said.
“It’s advice at a price point that suits, delivered in a way that suits – digitally – and this could be online, phone, video or robo.”
He urged for discussions with regulators, government and other industry players to be accelerated, commenting: “Coupled with the complexity of our tax and retirement systems and our ageing population, the imminent digital disruption is why we need to act fast.”
Mr Wade has made a call during a period of contention for advisers under the bank, with a number of advisers speaking out against AMP’s buyer of last resort scheme and the announcement of a “transformational” wealth strategy, which would require it to cull a number of advisers.
Chief executive Francesco De Ferrari did not confirm how many advisers would be dropped, but did say around a third would be lost in similar disruptions.
Mr Wade stated that AMP is a leader in the sector, “engaging with government, regulators and industry to shape the way forward”.
Robo advice is needed but so is making personal advice affordable. When Robo advice comes into Australia it will destroy AMP because they won’t be the people to bring it into the market as they are exceptionally inefficient with anything to do with technology and have managed to destroy their reputation with both the public and advisers.
In addition if the Robo Advice is done by a product provider (which it will be) then that just expands the reach of vertical integration which has been proven to not be in the consumer’s best interest. How about the government stop stuffing around and pretending everyone should be a lawyer and do something to actually improve consumer outcomes rather than creating another 100 pages of compliance forms which add no value to the consumer.
[quote=anonymous]this is the saddest thing i am about to write. but it’s true. nobody cares about the well being or thoughts of financial planners. nobody
nobody from amp reads the comments on this website
nobody from the industry reads the comments on this website
no politician cares about it (unless you have a bag full of $100k cash)
no office holder from afa or fpa read or care about it
nobody cares about you lot, yet you keep on lamenting on this website for what maybe temporary relief
best thing for you to do is to leave the industry
let the regulators and politicians figure it out, once the consumers get jack shit then they might realise they should have been nicer to decent hardworking advisers who often put themselves and their families last
but once they leave they won’t come back so good luck
shame on you james shipton you are directly responsible for 16 deaths[/quote][quote=anonymous]this is the saddest thing i am about to write. but it’s true. nobody cares about the well being or thoughts of financial planners. nobody
nobody from amp reads the comments on this website
nobody from the industry reads the comments on this website
no politician cares about it (unless you have a bag full of $100k cash)
no office holder from afa or fpa read or care about it
nobody cares about you lot, yet you keep on lamenting on this website for what maybe temporary relief
best thing for you to do is to leave the industry
let the regulators and politicians figure it out, once the consumers get jack shit then they might realise they should have been nicer to decent hardworking advisers who often put themselves and their families last
but once they leave they won’t come back so good luck
shame on you james shipton you are directly responsible for 16 deaths[/quote]
Advisers need to start commenting on the FPA, AFA, politicians and any other source of their social media. I have yet to see any comments about any of this except for 1 guy on any of the social media pages. Is it because people are scared of what could happen to them???
Well you can sit back and be scared or you can get on their and start making noise. Whats going to happen, you loose your job. Well we say nothing and chances are you wont be in the industry anymore anyway.
[quote=Perplexed]Why not tackle the reasons for advice becoming so expensive?
This country is full of utopian dreamers.
Advice wasn’t expensive when it could be documented on a Customer Advice Record.
Professionalism is trusting the practitioners. A neurosurgeon doesn’t provide a 100 page compliance document explaining every step of the procedure.[/quote][quote=Perplexed]Why not tackle the reasons for advice becoming so expensive?
This country is full of utopian dreamers.
Advice wasn’t expensive when it could be documented on a Customer Advice Record.
Professionalism is trusting the practitioners. A neurosurgeon doesn’t provide a 100 page compliance document explaining every step of the procedure.[/quote]
yes sure, but a neurosurgeon trains for 10 years. how long does it take to become a financial planner ? that’s our problem.
Why not tackle the reasons for advice becoming so expensive?
This country is full of utopian dreamers.
Advice wasn’t expensive when it could be documented on a Customer Advice Record.
Professionalism is trusting the practitioners. A neurosurgeon doesn’t provide a 100 page compliance document explaining every step of the procedure.
There was a goose laying golden eggs for a farmer once. The farmer purchased the best food and bedding for the goose and looked after than goose with all the love and care he could muster. One day AMP came along and made him an offer that the couldn’t refuse. AMP took the farm and the goose and placed then into an AMP capital REIT. Not long after AMP called in a bunch of whiz bank consultants to review their operations. They looked at the cost of the food and bedding for the goose and thought we can reduce costs here. The consultants recommended getting rid of the goose because it was just so expensive. AMP management unable to make a decision previously now had all the evidence they needed and promptly CHOPPED THE GOOSES HEAD OFF! They ate the goose for Christmas dinner and enjoyed a lovely bonus based on the new lower-cost structure they had created. The end!
Gav 4 hours ago.
[quote=Peter]Give me one thing AMP has done successfully in the last decade. Robo advice wont be it….[/quote] Easy . they lied successfully to ASIC 20 times…
Hi Gav, it was a lot more than 20 and AMP weren’t that successful at that in the end, poor old Jack Regan needed assistance from Michael Hodge, senior counsel assisting the commission after he ran out of fingers and toes to count off.
this is the saddest thing i am about to write. but it’s true. nobody cares about the well being or thoughts of financial planners. nobody
nobody from amp reads the comments on this website
nobody from the industry reads the comments on this website
no politician cares about it (unless you have a bag full of $100k cash)
no office holder from afa or fpa read or care about it
nobody cares about you lot, yet you keep on lamenting on this website for what maybe temporary relief
best thing for you to do is to leave the industry
let the regulators and politicians figure it out, once the consumers get jack shit then they might realise they should have been nicer to decent hardworking advisers who often put themselves and their families last
but once they leave they won’t come back so good luck
shame on you james shipton you are directly responsible for 16 deaths
Lets go right back to when AMP had youll earn a fortune in the 1970’s 🙂 since then they have had many many brilliant ideas FNA , but none of them really worked, AMP has been built on the back of its many Advisers who they now dont give a damn about, they are only a shadow of the organisation that they used to once be. Morales and Ethics out the window, maybe Mr Ferraro should speak to some of the top advisers and find out what is really going on in the marketplace ??
What a bunch of hypocrites AMP are. “Moral obligation” How about the moral obligation to look after your advisers who built your business and honour your contracts with them. AMP is a disgrace.
Unfortunately some fool let Robo out of the bag . I just invested , a client fact find , a risk profile worth 20 cents , and a set product selection , press the button and an SOA is emailed out . Fees were about 1% with half to product providers and the other to the Advisers company . What this means is that you can do the same as a FP for the same fee with face to face service or A robot without opt in out out and the other crap via an electronic form. Who allowed financial planning advice via a robot ?????Seriously ,the industry is going backwards and downwards. .
Being an AR these days is a liability, not a profession. One only needs to look at the number of auditors, lawyers, managers, and in some cases, questionable product distributors to realise, whether we like it or not, it is the AR that is now the gatekeeper to PI claims and the massive compensation schemes.
For these reasons, even if the AR has done a reasonable job, its worth throwing some mud at them to see if it sticks. Open the gates!
You’d have to pay me double what I’m earning now, and even then I’m not sure I’d want to do it.
Robo advice doesn’t magically produce the best advice from all offerings available given a clients objectives, needs, and circumstances. It funnels questions into a predetermined ‘solution’ that is what the owner of the robo advice want to recommend / sell.
Ask the right questions in the right order and you can ‘lead’ a person to make a decision to move into a product even if it’s more expensive – provided you’ve hit the compliance marks that can support a switch.
By any product provider creating this they can set the objectives and outcomes for any ‘clients’ using the service and they can remove the risk that an educated adviser might not have the same ‘recommendation’ that the client should be rolling into the providers more expensive product. Now that people advisers have a code, and ethics and a best interest duty they can’t be encouraged to use in house products unless they are better. A program can be made to do whatever you want and they keep on doing it.
It simply allows the programmer to enter their own bias and have a much higher sales conversion rate for the product provider (sorry Robo adviser)
[quote=Peter]Give me one thing AMP has done successfully in the last decade. Robo advice wont be it….[/quote]
Easy . they lied successfully to ASIC 20 times…
“Give me one thing AMP has done successfully in the last decade.”
Peter, AMP have burned through tens of billions of shareholders dollars pretty successfully!
As a former Genesys and then Charter Rep, I have experienced AMPs lying and deceit first hand. It is offensive that any AMP spokesperson be given credence on any matter to do with the industry.
It’s also quite ironic that advisers have to up their professionalism and FP qualifications for the sake of using tecnology better ?%^&* Why does a related degree in FP meet FASEA’s education requirements? I would think a related degree in IT and Tech would be better suited!
The best way to solve servicing small clients is to eliminate annual Opt Ins, & move to Opt Out. The clients know exactly what they are paying, as these fees are disclosed in the statement of advice, in the Fee Disclosure Statement annually & in the platform annual reports (at a minimum) or shown monthly online. There is zero reason now to have Opt Ins. Get rid of Opt Ins, then small accounts can be services just like IntraFund accounts.
Give me one thing AMP has done successfully in the last decade. Robo advice wont be it….
Am I missing something? AMP going on about our obligation to deal digitally…. but AMP don’t even accept electronic signatures…?! um…..
Robo-advice is actually Robot-advice run by Artificial Intelligence like facebook. Robots instead of advisers should keep AMP out of product failure trouble !!! Really.
Hi AMP Scum Bag: perhaps if AMP didn’t ruin it for the industry perhaps we wouldn’t be having this conversation… I lick my lips when I see a poor client with AMP Super and Insurance. I instantly transfer to cheaper and better products. Screw your AMP Bank Lending too…
“He noted there is a growing need and demand to build an advice solution that is “life led”, helping consumers at key moments when they need advice the most, such as investing an inheritance or redundancy, better managing their super, or paying off their mortgage”
I thought we had this?
Isn’t this scoping and scaling?
Moral advice coming from amp is like healthy eating advice from maccas.
So AMP’s answer is to remove the personalised service of a planner and replace that with an algorithm. Robo Advice is a race to the bottom as each new entrant will copy the incumbents as barriers to entry and customer loyalty will be low. AMP will argue for carve outs to the legislation at the expense of consumer protection. No doubt they will use the Uber argument that this is the new age solution demanded by the consumer to convince regulators to get their way.
AMP has never delivered on a promise. Evolve app, goals 360, AMP advice, the list goes on. This is a company whos only claim to fame is the destruction of capital and lying to the regulator 20 times.
Don’t need or “Can’t Afford” ….. Mmmm they used to be able to afford, but some bright spark decided that commissions were bad …..
Funny to see AMP lecturing the industry on morals.
How did he use the term “moral obligation” with a straight face?
I remember well during the 1980’s, when AMP tried to bypass their advisers by offering direct online service as AMP declared more growth was derived from their direct investments. When a market crash occurred, AMP turned to its advisers for help in stabilising the company’s fortunes. AMP failed then and it will fail again by trying to screw their advisers. It has been 18 years since I was an AMP adviser and the culture of its senior management has not improved. They ingratiated themselves at the expense of the advisers and then threw them under the bus.
Perhaps Alex could site for us some examples of robo ‘advice’ providers that make anything other than monstrous losses. Thankfully he has the AMP’s impeccable track record of success to fall back on.
Ironic that AMP should be preaching about a moral obligation of the industry to provide affordable advice. How about AMP start by providing the advice their clients paid for and did not receive???
The industry has “moral obligations”, AMP has already shown they have no morality.
Anyone who thinks Robo Advice wasnt the end game for all this crap going on have a good hard look.
What are Mr Wades qualifications, because I can see any of them, apart from being another Banker trying to dip his toes into Financial Planning.
To expensive? Maybe at AMP it is, my fees and charges are quite acceptable for everyday aussies. Maybe we should replace all middle management at AMP with robots, that would actually reduce the fees you need to charge…you big cost centre you. Mr Wade, please get some sort of experience, for example talk to a few clients, do the job for a while, then come back. People don’t trust robots , or for that matter middle managers trying to save their own you know whats. Robots indeed, get a grip.
Just to be clear on this. Reading the LinkedIn profile for Alex Wade there is none of the following:
– any Financial Planning experience whatsoever, or
– any Financial Planning qualifications at all.
So, who better to tell us all about “affordable advice”? Thanks so much Alex for your unqualified, inexperienced waffle.