After the Quality of Advice Review (QAR) was published earlier this month and recommended the removal of statements of advice (SOAs), paraplanners have expressed concerns about the future as a major function of their role may be scrapped.
Featuring on the Rise of the Paraplanner podcast, CEO of the Association of Financial Advisers (AFA) Philip Anderson and Financial Planning Association’s head of policy Ben Marshan assured that the future looks bright for paraplanners, with new opportunities to utilise their skillset expected to present themselves in the wake of the QAR.
If the removal of SOAs is agreed to, “paraplanners will actually be just as busy, if not busier, doing more strategies because planners are seeing more clients,” Mr Marshan explained.
According to Mr Marshan, statements of advice not only limit the capacity of advisers and paraplanners but also represent an unproductive use of their expertise.
“The value of the paraplanner is not in editing word documents.”
Mr Marshan explained that beyond QAR, paraplanners could be tasked with creating a financial plan, which would include the strategies and recommendations a client needs to take to meet their financial goal.
“There’s value in creating that, and for a paraplanner to present that to the client,” Mr Marshan asserted.
“[Clients] don’t like reading 80-page SOAs, they would much prefer to just understand the advice they are receiving and why it’s right for them. If you can do that in a simpler format, then you should. And the reality is, you can.”
Moreover, Mr Anderson emphasised after the QAR, the primary focus should be on preserving the quality of advice and highlighted that paraplanners play a critical role in ensuring the implementation of high-quality advice.
Ultimately, while acknowledging that the post-QAR landscape could lead to significant changes in the paraplanner’s role, Mr Anderson emphasised that the crucial role played by paraplanners in ensuring Australians’ access to quality advice remains of paramount importance.
“It will be a rough journey for a few years as we come to terms with what the regulatory change looks like, but the need will still be there,” Mr Anderson said.
“We encourage paraplanners to remain optimistic about the future and look at how they change what they do to meet the new expectations of what will hopefully be a new regime that works in the best interest of clients and all stakeholders.”
How will anyone know until we get there? I know a practices with $300K a year Parra planning wages bill. over time I know the directors will looking at that and saying in this new world, can we do it cheaper. While protecting us. And the Ans will be yes.
Our practice would fall over without our Paraplanner, the need for a second lot of eyes is so important to our compliance…..
Right – so if Planners will be able to see many more clients due to not having to complete lengthy SOA’s, then why will Super Funds need call centre based in-house unqualified advice providers?
I agree with that summary. Paraplanners will still have a role in post QAR. I think compliance will gradually disappear or change significantly which is really what is needed the most.
Compliance officers are conflicted and have a vested interest in creating an environment of fear which is very unhelpful and has become systemic.
This is a industry where compliance auditors often with limited basic diploma qualifications can oversee a degree qualified adviser with years of experience and tell them their advice is not good because of some absurd technicality.
It literally wouldn’t happen in any other profession. This school teacher mentality needs to go ASAP.
ASIC has moved on so now the AFSL’s need to as well or they might find themselves under the spotlight next.
Lets focus on the forest not the trees and you will find overall advice will improve dramatically.