The report from the Profession of Independent Financial Advisers found that 73 per cent of Australians said it was very important that their financial adviser is ‘genuinely independent’, while 14 per cent said it was somewhat important and the remaining 11 per cent said it was not important.
Similarly, 84 per cent of Australians said they would more likely invest in a longer-term relationship with a financial adviser if they were ‘genuinely independent’, compared with 16 per cent who said less likely.
As for transparency, 86 per cent of Australians said they would prefer their adviser charge them a transparent fee for their services, compared with 14 per cent who said they would prefer their adviser to continue receiving commissions.
The PIFA surveyed approximately 75,000 people between the ages of 40 and 55 for the report. The survey was conducted immediately following the release of the Hayne commission final report.
“There is huge untapped potential for independent financial advisory opportunities in Australia,” the report said.
“Australians understand and value the benefit of financial advice from genuinely independent professionals which can be paid for via transparent fees.”
Last month, PIFA president Daniel Brammall said the requirement to disclose a lack of independence as recommended by the Hayne royal commission will add to the disruption and confusion already being experienced by advisers.
“These reforms add to the complexity that is already facing advisers, burdened by the FASEA education requirements, the loss of legacy commissions that were supposed to be grandfathered,” Mr Brammall said.
“Then there’s the looming membership of an as yet unapproved code monitoring body.”
ifa released a client experience report similar to the one by PIFA. The findings formed the basis for the Client Experience Workshop, which was recently run in Sydney and will be held in Melbourne on 31 October. To register to attend, click here.
Interesting that a report that comes out from the Profession of Independent Financial Advisers and it supports their business model. Who did they survey their own clients?
I’m from an aligned licensee, as the majority practice owner I am constantly thinking about self-licensing to escape the draconian regime laid on us by the regulator – especially when I hear from independent peers and it’s evident they get none of the compliance regime we get.
What holds me back from switching are my clients. I discuss with every one of them the possibilities of independent v’s aligned. We discuss the risks and protections. Overwhelmingly clients want us to stay aligned, so we stay and put up with the repressive regime.
My own discussions with clients indicate preferences exactly the opposite to this report. It’s possible we’re both right and the data sets are different, in that they are already self selected, or that the framing of the questions leads the client to answer in a different way.
The reality is that clients have preferences in both directions.
Reality is everyone should be individually licensed through ASIC. No dealer groups and no associations should exist (enough is enough). I would happily pay an annual fee to ASIC. An adviser with their education, training and experience should be able to express what their independant & objective opinion is for their clients to achieve their goals for advice. No advisor should have to have their decision making influenced by dealer groups/product providers.
[quote=Anonymous]Amanda H – Really odd! Trying still to figure out your message as there is little reason or intelligence in what you say. You weren’t high when you wrote that were you?[/quote][quote=Anonymous]Amanda H – Really odd! Trying still to figure out your message as there is little reason or intelligence in what you say. You weren’t high when you wrote that were you?[/quote]
Well I’m not the one complaining or being impacted by my business valuation falling, my BOLR being reduced, a loss of commission revenue and or my retirement dream lost, not meeting education standards,… Opt in or FDS or whatever the sky is falling in issue facing the financial planning business… If you can’t appreciate, understand or decipher my comments I think you need a North Korean style re-education… no doubt a lack of understanding resulting from years of being brainwashed in some institutionally owned licensee. Perhaps you should find a better business coach.
Amanda H – Really odd! Trying still to figure out your message as there is little reason or intelligence in what you say. You weren’t high when you wrote that were you?
Just more evidence that the Financial Planning community is deeply out of step with the Australian population. Shame on all Financial Planners really…..And yet Stupid Financial Planners are still wondering why you’ve got so much Government regulation and intervention. Do they therefore deserve everything they get? The FPA doesn’t want people to be using the word independent because of two reasons 1) the funding they get from AMP and 2) one big fat membership cheque a year. Yet you happily pay them. Institutions keep saying how hard it is to be with a self licensed or privately owned group and planners believe them . Well it’s time you wake up to yourselves. Selection of a licensee, how you charge, and membership of a industry association are things under advisers control yet you continually keep wanting to be dinosaurs and subject to FASEA exams. Like Doctors being licensed by Pfizer or Thalidomide really isn’t it? About now it’s like Personal Trainers being authorised by Cigarette companies.
[quote=Anonymous]If I go “Unlicensed” from here on out will I meet the definition of “Independent”? I know it has more than a few advantages – off the top of my head 1) No Dealer Group Fee 2) No high PI premiums 3) No FPA/AFA Fees 4) No ASIC Fee 5) No FASEA Exam and costs 6) No additional qualifications to do and the costs 6) No Code Monitoring Body 7) No nearly impossible Code of Ethics to comply with 7) No Compliance costs 8) No Sole Purpose Test 9) No paper trail for ASIC to come and revisit ten years later and tell me now what I should have done then 10) No “look back” to 2008 – even ASIC has 7 years as a requirement to keep records and gave evidence in the RC to this effect 11) No 40 hours CPD pa 12) No liability as I am not “giving personal advice”. And if I get caught – I will likely be banned from providing Licensed Personal Financial Advice. [/quote] Who cares about independance…you’re a coach now and just saved $100,000 a year in costs…
Good luck with Trying to use the word “independent” even if you genuinely are. ASIC will close you down in a heartbeat. Not that any of us have much of a future left anyway.
It doesn’t really matter what the customer wants the government, ASIC and the FSC have ensured it will be impossible to be in this industry and actually make a living in the future.
s.923A and the most restrictive definition in the world for Independent Financial Advisers.
Over Bloody Complicated O’Dwyer and her Bank / Life Co. Institutional buddies who came up with making this concept even more restrictive to try to negate the benefits of IFA’s not being aligned / owend by Institutions.
Now O’Dwyers gone and so are the Banks & Institutions getting out of Financial Advice faster than the speed of their diarrhoea that left behind at the RC.
Good riddance O’Dwyer !!
Good riddance Banks !!
Now if we can only get some type of sense in Over Regulation BS Red tape from Govt !!!!
Tell him he’s dreaming.
You forgot to add the last point. 13) No AFCA – A compulsory dispute resolution scheme for licensees to be members of, who use their judgement to make determinations which are only binding on their member (the licensee), but not the consumer. Good luck.
If I go “Unlicensed” from here on out will I meet the definition of “Independent”? I know it has more than a few advantages – off the top of my head 1) No Dealer Group Fee 2) No high PI premiums 3) No FPA/AFA Fees 4) No ASIC Fee 5) No FASEA Exam and costs 6) No additional qualifications to do and the costs 6) No Code Monitoring Body 7) No nearly impossible Code of Ethics to comply with 7) No Compliance costs 8) No Sole Purpose Test 9) No paper trail for ASIC to come and revisit ten years later and tell me now what I should have done then 10) No “look back” to 2008 – even ASIC has 7 years as a requirement to keep records and gave evidence in the RC to this effect 11) No 40 hours CPD pa 12) No liability as I am not “giving personal advice”. And if I get caught – I will likely be banned from providing Licensed Personal Financial Advice.
Pitty the majority of advisers cannot claim to evenly come close to being called independent. Just remember it was the FPA who fully supported the recommendation that the word “independent”” be expanded to terms such as non aligned, non institutionally aligned whilst ever you get two cents in insurance commission.
Most of the publlic would not know the difference between ‘genuinely independent’ and an unaligned planner i.e. not privately owned self licensed.
ladies and gents. consider becoming a lawyer for your next career. it’s easy to do. if you have a degree already in finance or economics you will find it is very very very easy (emphasis added).
in nsw, cpd per annum is only 10 hours. we do 40 hours minimum, you will be able to do it while you are napping.
you will need to learn to Jam people though. or get them into a Jam. that might be hard for you people as you are usually the ones getting jammed left right and center by all and sundry [i]for their failures.[/i][i][/i]
I am doing it. easy stuff. all you have to do is to send clients a cost disclosure, then another one afterwards saying it’s gonna cost more, then another one after that one saying it’s more, and more and more. get it. most loved occupation of all time :-).
no opt in, opt out, soa, roa, fsg, pds, high pi, dealer group fees, etc etc. people already think you are a scumbag so you need to perform marginally better than that. very low expectations all around.
so happy right now. I can hardly contain myself.
Do we have a definition for “genuinely independent”. Or that just some sort of buzzword?
[quote=Anonymous]I no longer care what the customer wants – I am too busy with COMPLIANCE.[/quote][quote=Anonymous]I no longer care what the customer wants – I am too busy with COMPLIANCE.[/quote]
exactly. i am so busy with compliance. i avoid taking on new clients.
good luck getting advice. exact same thing happened in the uk when the stupids there did the same thing, and have now wound it all back to where it was.
listen, turds, to two very simple things:
1. there needs to be a very high return for the very high risk i am taking, otherwise;
2. i will avoid giving any advice if the return in 1, is not sufficient reward for the risk i am taking
thanks turds for making financial advice impossible to access for those Australians who need it most.
Would someone conduct a similar public survey asking whether advisers professional bodies i.e. FPA should be independent of product manufacturers and their conflicts? Oh, sorry we already know the answer to that.
I no longer care what the customer wants – I am too busy with COMPLIANCE.
Yes that may be the case but when it comes to commission on risk products how much are they prepared to pay ?
So over this industry…can’t get out it’s own way and far too many lawyers and policy makers charting its course. One thing is clear – advice is heading at swift pace towards only being for the middle upper class and the already wealthy…the amount of risk an Adviser takes on and for the red tape required fees will have to go up and not by a little bit. And if you think you can do it properly for less than $3000 a client or MORE then you’re not doing it according to the law now. Just too hard for all involved including the client who suffers the most from all this b/sh*t debating and reg making…
The survey is somewhat irrelevant now as it was taken immediately after the RC when it was in the media big time. Most of the normal public have moved on now to climate change, vegan protesting, the riots in Hong Kong and the list and life carries on.
This is completely unsurprising and entirely predictable from Daniel Brammall.