As the advice industry continues to grapple with the mass exodus of advisers, attracting new talent is expected to emerge as a significant challenge in the coming years.
Speaking to ifa, Dr Katherine Hunt, a financial adviser and researcher at Griffith Business School, stressed that advisers looking to attract new entrants need to be a lot more proactive.
“If financial planners wanted more entrants, they would be at every single school. They have this little day where all the professions show up and the financial planners are not there,” Dr Hunt said.
Acknowledging the efforts of the Financial Planning Association and Association of Financial Advisers in incentivising more young people into advice through national schemes, Dr Hunt added that they need more support from the industry.
“The FPA can’t be at every single school’s career day, but a financial planner could.”
However, the need for support extends beyond recruitment.
Namely, according to Dr Hunt, those who pursue a career in financial advice require quality education to succeed. And although Australia’s education system is considered “top of its class” in terms of reflecting the profession, Dr Hunt explained that there needs to be a significant shift in the way universities approach financial education.
Dr Hunt pointed out that the industry has evolved significantly in recent years, which should inspire universities to pivot towards a model of curation, whereby experts from the sector are brought in to ensure that education remains relevant for new graduates.
“There’s a lot more tech involved, there’s a lot more vision in terms of strategy for clients and less focus on the product,” Dr Hunt said of the industry today.
Acknowledging the limitations of universities, she said: “The path forward with this is of course the curation of education rather than the poor academics trying to reinvent the wheel for every single course, but rather to curate amazing experts from the sector and bring those in on a year-by-year basis as well, so everything’s up-to-date and really relevant for the new grads”.
“That’s the way I see the future happening or needs to happen. I’m not sure when it’ll happen, but that’s my vision,” Dr Hunt added.
Recent data has suggested that an increase in the number of new advisers entering the sector since the back half of 2022 has helped licensees battle adviser attrition.
“The number of new entrants to financial advice, initially as provisional advisers, was very sluggish when first introduced in [January] 2019,” Wealth Data founder Colin Williams said last month.
“However, we saw a dramatic improvement in the second half of 2022, which continues in 2023.”
What lie to them and tell them its a great profession? Full of paperwork and unworkable fee arrangements and of course the 66% upfront you get for premiums insurers will raise year on year well above inflation…… with that awesome 2 year clawback.. do your time and become a lawyer….. that way you can rip people off left right and Centre and have no one to answer to.
The previous government caused this so let government fix it.
Until Annual Fee Renewal Consent forms are eliminated & the adviser education situation is fixed, expect nothing to happen. Too much risk to expand advice services in the current environment
It would be unethical for any adviser to encourage anyone to join the profession. Financial planners are the punching bag of the government, ASIC, AFCA, product providers, consumer bodies, the media, lawyers, accountants and the list goes on. You work huge hours, complete ridiculous paperwork and compliance (that lawyers, accountants and doctors don’t have to do) and if you make the smallest error ASIC is there to name, shame, ban, fine and possibly jail you. AFCA will actually work with a complainant to make a frivolous case against you. Why would you wish this upon anyone?