ASIC’s Financial Adviser Register (FAR) currently boasts 16,356 advisers, but according to the latest estimates, less than 50 per cent are expected to benefit from the government’s education reform proposal.
Namely, the government is currently consulting on a plan to remove the tertiary education requirements for financial advisers who have 10 years’ experience, a clean record and have passed the relevant exam.
The government’s consultation paper states that to be eligible, each adviser must have at least 10 years’ experience up to 1 January 2019.
In order to ascertain how many advisers this proposal could benefit, Wealth Data dug into the numbers and found that a total of 8,695 advisers had 10 or more years’ experience as at 1 January 2019. However, of that number, 14.1 per cent boast an approved qualification, meaning that the government’s reforms would benefit the remaining 7,469 advisers.
However, these calculations are complicated by the government’s definition of “experienced advisers”, namely according to the consultation paper the 10 years of experience doesn’t need to be consecutive and could have been gained anytime between 1 January 2004 and 1 January 2019.
“There are quite a few other factors that need to be considered in terms of how many advisers will benefit from the proposal,” said Wealth Data director, Colin Williams.
Firstly, he noted, with the exam deadline unchanged from 30 September, adviser numbers are expected to dip below 16,000 in October.
“Lastly, the date for the approved degree requirements is January 1, 2026. It is very likely that many advisers who commenced pre-January 1, 2009 will retire by that date,” Mr Williams pointed out.
According to Mr Williams, the sector that will gain the most from the government’s proposed education revamp will be the financial planning sector where some 48.8 per cent or 2,952 advisers lack a degree.
News of the government’s consultation on financial adviser education standards was met with a mixed reaction.
Namely, while the Association of Financial Advisers welcomed the news, some were disappointed that the exam deadline remained 30 September.
“We were hoping for a 12-month deferral of the exam, a removal of the ambiguous ethics content, and inclusion of questions around competency of their advice specialty,” the Association of Independently Owned Financial Professionals’ (AIOFP) executive director, Peter Johnston, told ifa.
“To be fair, the minister did not specifically promise any exam changes, but we will however continue with our lobbying activities until October 1st in hope of a change of mind.”
Submissions are now open and will close on 16 September 2022.
I’m tired of being lumped in with those who “lack a degree”. I have a Bachelor of Business but it doesn’t qualify as relevant, because it’s not an accounting or finance major.
If you read the QAR (scenarios at the end), the industry funds will be recruiting Macca’s style intrafund “advisers” off the street, so they can process all of those TTR Pensions internally lol
What a disgrace if these changes are made. We were on a path to becoming a recognised profession and so many advisers got on board only to see once again the “status quo” advisers get another grandfather clause!!!!
I feel so sorry for the advisers like “Shaking Head” and “BL” and all the others who see the real future in becoming a standardised well educated profession and have, and continue to, invest in themselves and the industry.
I’d like to know, for those like me, who have the relevant education qualifications and have had decades of experience, what’s in it for us? We’ve made the effort to complete up to AQF9 education standards (and the few who have achieved PHD well done) but nobody in authority gives a fig. Give something us for once rather than pandering to those who have not made the effort. The total input by Labor, Liberal, Independents and Greens has been pathetic and devastating.
You can keep bragging about your wonderful certificate on the wall, as you have for years now. Good for you.
Meanwhile, the average client just wants to make a buck for themselves.
What an absolute backward step to becoming a profession! the current standards are fine, 2026 is still 4 years away if you are unable to slowly complete the required study in that time then really the rest of us do not want you in our profession! I am 58 years old, over 25 years under my belt in the industry and going back to complete my masters really was not that difficult.
100%
Well these changes have cost me well over $15,000 by doing the right thing and completing the required studies.
Do we now have 2 classes of advisers? those fully qualified and those Partially?
Will the government compensate Advisers doing the right thing?
If you paid well over $15,000 you were taken for a ride, unless you are basing that on your work hourly rate multiplied by the number of hours you spent studying?
$15k is a small amount to become a real professional. Its sad to think that we have advisers who consider an education to be coming to work for 20 years and doing a few PD Days.
Looks to me like Michelle Levy is recommending two classes of Adviser. One like you, qualified, experienced and doing ongoing education, TOE, FDS, Opt-ins etc etc and another paid for by the Product provider – subsidized by the members collectively. You guess which one the Authorities believe have the Conflicts in the advice delivered?
how many advisers have already left that would have benefited???? 5,000???
Thanks frydenburger!!
Thank god they’ve already left. This profession has left them behind. We only want doers amongst us.