Speaking to ifa about research the university has conducted to shape its unreleased master’s in financial planning course, UTS finance professor Marco Navone said higher education standards will benefit the industry.
“As an academic, here I must warn of a possible conflict of interest, but I honestly think that FASEA is moving the system in the right direction,” he said.
“Asking for an academic qualification limits the risk of having the industry flooded by certification providers offering ticking-the-box solutions based on online quizzes. Of course, the devil is, as usual, in the details.”
However, Dr Navone said balancing the need to recognise advisers’ past experience with benefits that come from completing a degree qualification will be a notable challenge for FASEA.
“A particularly complicated issue is the transition for existing advisers who have years of professional experience but do not meet the new qualification standards,” he said.
“On the one side, one wants to properly value the wealth of experience of these planners, but on the other side, it has to be recognised that people who have come to the profession without a degree in business or finance may benefit from a more systematic learning experience.”
Dr Navone added that the shape FASEA’s framework will take also presents a challenge for the industry, as it is difficult to predict with the information presently available.
“What topics will have to be covered in the accredited degrees? So far FASEA has adopted the existing FPEC structure. Is this an indication of what will happen next year? Without having the complete picture is difficult to form a definitive opinion,” Dr Navone said.
Anyone find it slightly ironic the industry complains about the clear conflict of interest between FASEA and education providers yet we also campaign to retain commissions?
Probably need to make up our mind, bit hypocritical as it stands.
An academic who stands to gain financially from FASEA thinks its a good idea. Who would have thought it??
once all the advisers are degree qualified. can we please have a mandatory [b]financial planning degree[/b][u][/u] qualification requirement for
a. all BDM’s
b. training and education officers
c. compliance people
d. responsible managers – if not qualified already
e. journalist making commentary
f. “experts” commentating on ANY aspect of the industry
please talk to the hand before you have a financial planning degree before you attempt to think about talking to us
Add to that the compulsory ethics obligations and courses applied to us as FP’s, to [b]all[/b] those (incl Exec’s and Board Members) that work in any department of a company that has anything to do with Financial Services and you’d have my vote…
I am with you, they don’t need a listen in ethics, they just need some jail time in maximum security and they won’t want to do the wrong thing again trust me
Perhaps a FASEA Board member should be required to sit the Exam, and complete 50 hrs CPD every year. Oh – and as a pre-requisite, a Board member MUST have a ‘relevant degree’
Yet another academic trying to get on the gravy train. Wonder what actual financial services experience he’s had at the coal face – apart from checking his bank account that is. The minister has got to stop half
the industry disappearing because of these academic know-alls. She needs to look what happened in the UK and the huge back flip they had to do there to save what was left of the industry. Come on lady. Get serious or get out.
IFA – please ask Dr Navone if he thinks their own UTS / FPA Estate Planning Specialist course I have done should be worth nothing under FASEA ?
Thankfully FASEA have currently said they will recognise past relevant degrees, so my Bachelor of Economics, double major in Economics and Business Law is worth something.
Yet education and experience below = Nothing:
– Deakin University Diploma Financial Planning subject 1-8 is worth = nothing.
(Regardless of DFP 1-4 being Government mandated education for all advisers RG 146)
– Grant Abbott (2 week full time plus assignments) SMSF Specialist Adviser Course and SMSFA accreditation worth = nothing.
– University Technology Sydney/FPA Estate Planning Specialist Financial Adviser course worth = nothing.
– 20 years’ Adviser experience worth = nothing.
– 20 years CPD worth = nothing.
– 13 years AFSL Responsible Manager worth = nothing.
So back to Uni FASEA want me to go and they say it will only be for 3 subjects, at a cost of I guestimate of $6,000 per course = $18,000 in course costs
Plus FASEA say it will take 120 hours per course x 3 = 360 hours at an hourly professional charge out rate of $300 = $108,000 (ex GST). Add an additional 10% GST would be charged, so that’s $10,800 less for the government in GST from me.
[b]Outrageous FASEA costs estimated at $126,000 for the education reform bill. [/b]
Wow and i’m supposedly lucky i have to only do 3 subjects.
I would be very interested to see where you are getting your costing from per course, $6k is absolutely extreme, the average cost per course, MBA/Bachelor is in the region of $2,500.
Kaplan bulk is even cheaper. Some of the courses assess with just assignments. I’m not against the courses but the time factor is way too short. We need breathing space,because fasea dragging their wooden leg.
Exaggerating to make a point although the point I understand if he/she has a economics degree which is quite relevant.
I disagree.
When does a plumber ever have to go to carpentry / plasterers / concreter’s / roof tilers or electricians school in order to be a plumber???
I have over 10 years experience as a risk insurance specialist and have no interest in providing managed funds advice yet I now have to go back to school to learn how to do that – and at enormous cost. This is also at a time when my income has already been capped and is reducing further over the next three years along with increased (over the top) compliance obligations and longer responsibility periods!
Where else in any other industry is this type of persecution occurring?
For “industry experts” to come out and say increasing the education standards will stop unethical behaviour is just a nonsense. The Royal Commission proved that with several top-end executive managers, with degrees and diplomas etc., showing this is simply not the case.
I despise what this industry is becoming and have no other option but to fall in line but I absolutely refuse to accept that these higher education standards will have the impact government and regulators say they’re going to have.
As a risk specialist, are you only writing retail risk? If you are funding from super, you are reducing the balance and should be checking if they are invested in accordance with their risk profile. Do you suggest they use top up contributions to reduce the impact of the erosion of their super balance and are you recommending they have a binding nomination in place. All of this is super advice that impacts the underlying investments. I am a risk specialist and think I need to advise on these types of factors; so rarely would risk advice be just risk advice. We should need to know this, and advise our clients as such, so I don’t see why FASEA shouldn’t apply to us.
I am taking these other factors into consideration and clients are ALWAYS advised about topping up contributions to avoid erosion effects on their retirement nesteggs – and yes, retail risk only.
if you are recommending they use partial rollovers and are therefore funding from super and then you are telling them to top up contributions then you are giving superannuation advice (and underlying investment advice) not just insurance advice and should be require to upgrade your skills as per FASEA. You would need to write retail risk without super ownership/funding to not be giving super advice
you need to have a theoretical and practical understanding – read working knowledge – of all things finance, if you want to be a specialist in risk only that is absolutely fine, just so as long as you have the aforementioned, working knowledge of all things finance before you specialize in your particular area of interest / passion
we need your years of experience so please stay, a grad dip is not a big ask you can do one subject a year and you will get 4 x exemptions (most likely for your years of experience)
please stay on we need you.
ok no problem. you don’t need a degree. keep going without one. fasea will understand and make an exception for you.
ok good luck
I totally disagree. When does a plumber ever have to go to carpentry / roof tooling / electricians / concreters / plasterers school?
I’m a Risk Only adviser with 10.5 years experience and have no interest in managed funds advice. Why do I have to go learn something I won’t advise in??
Yes, I’ll be be better educated. So what! It’s a total nonsense that higher education standards will stop unethical behaviour. That was proven during the Royal Commission with the behaviour shown by some of the big banks executive management who have degrees, diplomas etc. This is total BS.
Because all financial planning overlaps and all areas need to be considered to do the job properly. Its not BS, its common sense.
Shouldn’t be funding premiums though super without considering what impact that may have on the client’s retirement etc. If you fund them all personally how much does that impact their cashflow and does that detract from them meeting their other goals? What level of return do you forecast in the needs analysis when calculating present value of the required income replacement in the current economic outlook?
So much more to it than just running the same risk needs analysis in a ‘one size fits all’ approach.
The premiums funded by super rarely, if ever, result in clients coming close to reaching their contribution caps and clients are ALWAYS told they should make voluntary contributions back into their super to offset the erosion effect that ongoing partial rollover’s could have on their superfund retirement balance. What else is there??
Seen plenty of cases where they do max caps or certainly will if cover is retained as client ages… If salary sacrifice is going to funding insurance premiums, it leaves far less for retirement. Often you want to increase contributions for clients but are limited due to insurances etc otherwise you need to top up with less beneficial non-concessional contributions… Sometimes cancel and replace to move outside superannuation or structure differently, rarely considered by risk only advisers.
TPD figures rarely grossed up to allow for tax payable etc (which erodes the ‘tax benefit’ of being within super much of the time).
Shouldnt be able to write a cent of insurance within super without modelling the full financial impact of doing so. Dont mind Life/TPD in there but too many dump as much as possible in there to get paid as much as they can as they know clients are more likely to accept due to it not impacting their cashflow.
If insurance premiums (plumbing) are paid out of super, you need to be qualified for Super (carpentry).
That’s NOT what I’ve been told by my licensee. I only advise on the insurance.
might want to find a new Licensee!
maybe he was with dova
My friend, I really think you are opening yourself open to potential litigation the way things are going. i would recommend you get written confirmation from your licensee (which may not hold up in a court of law mind you) stating what you have declared to us.
This is why dealer groups are dying and will be extinct soon. They say these things to keep the money coming in while they know its not the case.
It’s all about the industry becoming, or at least be perceived as professional. Comparing trades misses the mark somewhat.
exactly a plumber is respected, useful and earns $300 per hour and in very high demand so please don’t compare to plumbers
because it’s now communities expectation that you have a qualification. Times have moved on the Government has stepped in an over regulated. It’s what happens when industry associations like the FPA get paid from the likes of AMP & NAB and planners are happy with this relationship. I’d expect more to come.
UTS should spend more time lodging my Bachelor of Business degree majoring in Financial Planning completed in 2008 with FASEA and less time on IFA pretending to care about the profession.
9/10 clients seek and value an adviser’s wisdom gathered over many years of experience. That needs to be protected and preserved in the educational standard transition. Otherwise clients and the industry looses vital corporate memory to the next generation of clients and advisers alike.
Being experienced and being good at your job are not mutually exclusive. The worst advisers I know are the DFP only w/ grandfathered CFP operators with 30 years of ‘experience’. They are stuck in the old sales regime and its gonna be great when they are gone.
Yes Dr Navone, the education industry has its snouts in a very smelly trough. And if I had the un-manageable conflict of interest cash starved universities have in this matter, ASIC would ban me for life. And where are the courses for risk specialists of 20 plus years experience.