Asked how they planned to prepare for the introduction of new education standards, 75.6 per cent of the 3,536 respondents said they plan to leave the industry.
Respondents planning to upskill and obtain new qualifications accounted for 18.9 per cent of respondents, with a further 3.4 per cent saying they already have the necessary qualifications.
Just 2.1 per cent of respondents are at this stage undecided on their course of action.
The findings suggest a much larger percentage of the industry may opt for early retirement, vastly outnumbering the previous predictions reported by ifa.
In September 2017, Deakin University associate professor Adrian Raftery suggested that between 21 and 34 per cent of advisers may choose to leave the industry, based off anecdotal evidence of conversations with industry participants.
“Of course they are leaving the industry,” the academic said.
“Every conference I go to they say ‘my retirement date is 31 Dec 2023’.”
Dr Raftery’s prediction followed that of research house CoreData, which anticipated that fewer advisers may choose to leave.
The CoreData research found that 68.1 per cent of respondents intend to meet the requirements, while 16.5 per cent would rather change careers. At that time, 15.4 per cent of respondents said they were unsure.
The latest ifa poll results may suggest that appetite for further study has waned since late 2016 as FASEA’s approach to regulating the mandatory education regime has become clearer.
FASEA has not really understood the real problem. Its the corrupt banking system and shareholders return which has driven this change . A bank teller suddenly with the minimum qualification has suddenly become a financial planner!!! Most clients who have suffered any loss or disadvantage are bank owned. APRA and ASIC need to ensure that product manufacturers should never be able to sell their own financial products due to conflict of interest. A oerson with 35 years experience who has a post graduate degree, Bachelors of commerce, DFP, ADFP, FChFP still needs to go and get a Bachelor’s or post graduate in Financial Planning will not achieve anything at all. Its just ignorant and stupid.
Luckily I meet the requirements – just! As an adviser with 20 years of practical experience I will most likely be an elder statesman of an industry being regulated into oblivion. I’ve done the right study, built a great business, have extremely satisfied clients & can’t keep up with the referrals trying to deal with us. I run a highly compliant, best interest focused pure financial planning business & have never had a single complaint. To top it off I’ve even been asked to nominate for the board of the FPA.
[b]However I can’t wait to leave this over-regulating, over-taxing industry & country whose primary focus is to be an impediment to business & create more & more useless bureaucratic administrative type jobs![/b]
Clients just want good advice at an affordable rate. Sadly we turn many away because the costs to serve them are higher than what they can reasonably pay. Clients need to get a reasonable return on their investment net of all costs, including those of the adviser. The more red-tape we have – the higher the cost to serve each client. This results in a far smaller pool of potential clients who can absorb the cost of red-tape & still benefit from receiving advice.
Putting your worth in investment returns is a recipe for failure.
That’s [b]not [/b]what s/he said.
There is one simple reason why the number of planners looking to exit has increased since Adrian Raftery’s “survey” last year. FASEA has exceeded their mandate. Rather than requiring all planners to get a degree, they have decided that 95% of planners who already have a degree need get another one!
Some sections of the media are incorrectly reporting the impending adviser exodus as due to legislation requiring advisers to have a degree. That is only a small part of the explanation. It is FASEA’s additional degree requirements that were never in the legislation, that is driving the current poll results.
Either FASEA has been completely misunderstood, in which case they need to act fast to clarify their message, or they have made a monumental mistake which they need to quickly rectify.
I was talking with a friend about this the other day. He knows planners who have degrees in music, tourism, teaching, business (without fp focus). These guys/gals should have to do a new degree in financial planning. Not just have A degree. I can’t use my finance degree to become a doctor/lawyer etc.
The difference is that experienced planners with degrees in other areas will usually have done thousands of hours of short courses in financial planning specific subjects as well.
Having a degree in another subject proves they have the intellectual capability and rigour to analyse and apply information at an advanced level. This is the whole point of the government’s degree requirement. It is not about having lots of point in time specific subject knowledge, as that dates very quickly in financial planning. Unfortunately FASEA seems to have lost sight of this.
“will usually have done [b]thousands[/b] of hours of short courses in financial planning specific subjects as well”
Not just a huge generalisation but an absolutely baseless statement at that! Such claims will do nothing to address the issue at hand or move a deeply troubled industry forward. And if your retort includes anything about Ctrl F CPD points…… don’t bother.
Couldn’t agree more.
If by “[i]Consultation[/i]” FASEA actually meant they’ll listen to feedback, my suggestion for existing advisers would be as follows:
😀 Those with an FP specialist degree (AQF7) [b]and [/b]appropriate CPD would qualify
🙂 Those with a business or finance related degree [b]+[/b] ADFS (AQF6) studies [b]+[/b] appropriate CPD would qualify
🙁 Those with an unrelated degree (or no degree) would need AQF7 or AQF8 level FP studies [b]and[/b] appropriate CPD would qualify
Just my two cents…
A much more sensible proposal than either FASEA’s or FPA’s.
It’s very hard top provide feedback to FASEA for consultation – they have no contact details on their website!
While I agree with you there, some planners have literally done a Masters of Financial Planning and based on the current standings would need to go back to school. Thats just silly.
The vast majority of subjects in a Financial Planning degree are actually from within the existing school already. i,e the same taxation unit that is offered in a Commerce degree & offered to Accountancy students are usually re-badged and sold within the planning degree and vice versa. Why then should Finance related degrees such as Commerce, Economics and business degrees be excluded? Any gaps in learning could be covered by a Diploma or single subject enrollment. CPA Australia can simply state entry into their courses is via these subjects. Why have FASEA decided to limit the pool of advisers we can draw future planners from? No one would expect a Music degree to be counted.
I have a degree in financial planning completed in 2005. I guess they expire every 10 years?
Absolutely agree and we all need to start a massive political consultation with all our local members of parliament.
And these MPs should also be forced into new post grad degrees in common sense and ethics. And no old degrees count.
ODwyer especially your old law degree should now be absolutely worthless.
Guys, we need individually to put a submission to FASEA before 30 June. THEY ARE SEEKING SUBMISSIONS Don’t hold your breath for the FPA & AFA to put a submission. On recent track record they will drop us in it, thinking they are “participating”, but will be inept and ignored, and will ignore the needs of risk only advisers. Remember these two esteemed bodies sold us down the river on qualifications/designations that are now DEAD, if FASEA are not pulled back from the brink. Maybe its time some of the lemming like insurer CEOs, that went along with the banks, realised risk new business is under severe threat with LIF & FASEA.
I would be interested in dong this, how do we do this?
Being an adviser for 2 decades I can with confidence say there are only so many stock market crashes that an adviser can safely guide clients through. Most advisers treat clients like their Mum or Dad and take this fiduciary responsibility very seriously. It’s this environment of stock market crashes, constant learning, constant change, running a business, continual learning that we face. For many degree qualified advisers with older qualifications more than 10 years old it is the final straw that broke the camels back. We want to get rid of all this life experience just because your degree in Commerce or Finance or your 2006 Masters in FP is now too old is a joke. I reckon the number will be easily be 30% to 50%. I have had a break in studying as I had mortgage, a Degree, a Diploma, and a Grad Dip and I spent the last 10 years reading every book, attending every course on trying to build my own financial planning business.
I don’t even know where to start here. Unlike many posts here I’m on the other side of the equation, young and in the early days of my career. I’m 26 and have been advising for the past 6 years – obtained DFP, ADFP, bachelors degree, CFP plus all the little small courses along the way. I haven’t stopped studying since I left high school.
But, I intended that to happen so that now, at 26 I could have (what I thought) would be my formal education so that I could go off and have my family and do the mum thing for a while.
I have just purchased my first house and intend on starting a family in the next couple of years. So now not only do I face having a new (capital city) mortgage but new expenses of a family over the next few years to add to the pressure of having to do god knows what degree to keep this mob happy. And not only this, but the people I look up to as my mentors are all leaving the industry. I can’t even get a head start to finish off these qualifications before I start a family because nobody can tell us exactly what they want and what my qualifications will even allow me to do.
I want to be in this industry, I really like my job – I will do whatever is thrown at me education wise but it is so over the top what is happening here. So not only am I about to enter the most expensive phase of my life, but the base in which I had built to allow me to start a family etc. has (potentially) drastically changed & my thousands already spent appear worthless after all.
There are so many domino’s in this game and everyone is going to be disrupted in one way or another.
Dear Anonymous lady, Your comment makes me[i] so[/i] [b]ANGRY [/b]I can’t begin to say how much! I’m [b]ANGRY [/b]because I know the truth in what you say and I empathize with every word you’ve written. I am SICK [i]to the core[/i] of the trouble, fear, uncertainty and doubt that this idiot conglomeration called FASEA has caused and continues to cause. It is fully inexcusable what they are doing. They are nothing more than a small bunch of power-drunk ego driven academics who have no concept of client best interest or interest in fostering an industry, which is their reason for being! Worse, they are seemingly answerable to nobody and impervious to critical comment. Can you spell G-E-S-T-A-P-O ?
.
I wish you the very, very best with your stated goals in life. I am on the other end – planning retirement ‘[i]sometime’ [/i]between 2020 and 2024. Hope fully there will be a buyer for my business if this FASEA cancer hasn’t [b]completely [/b][i][/i]decimated the financial planning industry by then – good chance – so all the best of luck! Clearly, we both have our individual challenges ahead.
Thanks Squeaky! I wish you the best of luck too, we are all in this together!
The risk and cost in being an adviser is enormous. Way way way too high. My time is worth more to me than pandering to the scary bogey man the FPA has invented to sell courses and justify their position in society. I predict the next phase in the mid 2020’s will be planners ridding themselves of the FPA and any other ridiculous regime and it’s circus of compliance by branching out into “advice” based services that eliminate the need of a license or member groups. Someone will invent a way and it will be a satisfying end to the likes of the FPA and it’s mafia type tactics.
FASEA not FPA are responsible for this.
fasea is fpa, look whose in charge. man with silly hat
FPA is not FASEA. The FPA are not in support of that rubbish proposal paper that FASEA released last month. The consultation period is not yet open for FPA to state this formally. FASEA currently only has one employee, and the professional associations are sitting on a lot of material to avoid swamping him just yet. Sit tight.
Then where is the voice of the FPA on this? They should be jumping up and down in anger.
With industry experience at the coal face for 35+ years I believe nothing has changed in regard to ethics, high standards, duty of care, giving the right advice as if it was you as the client. A small percentage of advisers have let us down. Just remember there are far more ‘other professionals’ in jail compared to Planners. All of the research demonstrates, as well as our own experience, that people are seeking advice now, more than ever. Yes, it is complex, yes it is challenging, just get over it and on with it. One must agree with the opportunity sentiment. The only struggle any adviser has is finding the solution to the question ‘where is my next client coming from?’ Make everything else a system and process, get others to do the stuff you find boring or hard, outsource it, get on the front foot with clients and build enhanced relationships with them, and with other professionals. Frankly, the opportunity has never been better. Whatever has to be done, get on with it, and keep positive.
My decision is an easy one, I am over 60, never expected to be forced out, however, I’m not going to just walk away, planning my exit strategy with a succession plan, I will remain as part owner of the business, bring in “Bright young things” to do the work, after 35 years I deserve to receive remuneration for all my years in the “salt mines”. plans are being escalated to conform with and to try and stay ahead of the game, two new staff people brought on in the last 3 months (CSO and Para planner) with a third (Planner) sometime in the next 12 – 18 months.
LIF has been a big disruption to our business, but we anticipated this as well, and we went 3 years early with our risk business Comm’s and have been changing the business from a traditional Risk / Super business over the last 2 years, the financial cost has been huge, and we still have a way to go, but with hard work and careful planning we will manage to deal with it all, we are beginning to see light at the end of the tunnel. My only hope is that we don’t get hit with another wave of so called remuneration reform in the next 3 years. i don’t trust Bill Shorten as far as I can throw him, and the current mob are pretty useless as well. The most important factor is (for me) to have the absolute right person as the succession plan partner moving forward, I am fortunate to have such a person, I am also fortunate to have awesome new staff.
Sounds like a win win for you. Sadly your contribution to financial planning will read as follows: Entry fees of 4% and an entry fee of 4% from super to pension stage. No disclosure of commissions or advice fees were common. No higher education or study whatsoever apart from a odd CPD day quizz, three page SoA’s throughout the 1980’s, Fund Manager kick backs, 110% commissions on insurance upfront and bit of churn, maybe even a buyer of last resort option etc or paid fund manager event. Now you’re going to sit back and be a part owner whilst the rest of us who wanted Financial Planning to be a profession and actually went out and did some actual study are all at school and face the tertiary education fine. A great contribution. I’ll Apologies now for the anger, best of luck for the future.
Haha so true. If you haven’t received the remuneration for the “last 35 years in the salt mines” what have you been doing? The last 35 years in the industry have been an absolute gravy train of epic proportions which has us in this mess. A ‘traditional risk/super’ business is hardly financial planning, that’s just product flogging.
Good luck trying to make money in the “new age” and attracting new staff. Going forward there will be no one to hire in this business as the “bright young things” will have much better offers in other employment opportunities. Why would a uni graduate want to subject themselves to this industry, compliance and risks for very little rewards . Its a joke.
Already am on a completely fee for service basis. Its all possible if you try (not that I am anti-commission, just a business choice to future proof).
Well, I have the degree necessary to work in the industry, have worked full time in the accounting industry while i was studying …but now i am finding it difficult to obtain a job in the financial services industry due my lack of experience. Why bother starting in an entry level job that i dont require the degree for? Go Figure! Damned if you do, damned if you dont 🙂
Hang in there – Employers may look to hire Financial Planners before the end of the year so they don’t have to comply with the Professional Year which come in from 1/1/19 for any new advisers.
Keep your chin up. Try knocking on a few doors, one will eventually open up.
Good luck.
Having been in the industry for over 38 years and started as collector agent,done the various courses run by the Life Underwriters (later changed to Lifewriters & now Financial Advisers) and have all my Diplomas in Financial Planning & Superannuation, plus having to pay you own office rent, professional indemnity, all other expenses (stationary, postage, and a staff) and now you have to the fat cat government for the costs of ASIC and pay to study for a degree. I just have one advice just get out of the industry. Brad Fox and Kelly O’Dwyer have killed the golden goose. In 10 years time there will only be a handfull of advisers.
Makes me SICK to the core to agree with you Anthony but agree I do! 32 years speaking here . . .
They want to kill the advisers every way possible!
You’re right Bob and right-er than you know! The [b]life companies[/b] are the main ones that want to kill advisers, believe it or not. We all know that life insurance needs to be SOLD. The life company execs continue to demonstrate their belief that the [i]computers [/i]alone can sell their life insurance policies. [i]YOU COULDN’T MAKE THIS STUFF UP !!! [/i] These poor unfortunate little creatures running the life companies and making corporate policy actually think that they can run their businesses in the 2020’s and beyond using RoboAdvice supported by a claims system that tricks consumers with underwriting at POINT OF CLAIM. I’m [i]serious [/i]AND I know this from the inside. They [b]are [/b]serious. [i]Oh,[/i] what a glorious deathbed they are preparing for themselves and their precious life companies.
.
As we fully know now, at least 75% of advisers will have left the industry my the mid 2020’s. let that stat sink in for a moment and contemplate what it is going to do to life company profits; they simply won’t survive. The life companies execs, however, in their blinkered thinking, will for a short while think all their Christmases have come at once . . . no BDM’s to pay . . . no pesky commissions to pay those nuisance advisers . . . . less pay for client service people as only general advice is given . . . new business coming in at next to no cost thanks to RoboComputers selling policies . . . they’ll be celebrating like it’s 1999 – for a [b]short while[/b].
.
THEN, when claims stop being paid, the media gets involved, public outcry will ensue due to tricky claims practices and then guess what. The life companies will then want their advisers back to save them but it will be far too late. The life companies will reap what they sew in a big way. Just think, they could have kept enough advisers to save them if they’d done just one little thing . . . pushed to have a ‘Risk-Only Licence’ qualification. Enough of us Riskies would have likely stayed with this concession. Stupid, stupid, greedy companies . . . all the while professing: “we are passionately committed to the adviser distribution channel”. Heard that one before have we, just once?
One word: Opportunity! 🙂
One word…clueless
One word: Gutless! At least include your name bozo
Hahahaaaa! Luv it!
FASEA’s inability to recognise the diverse yet still relevant pathway that many have arrived at their Planning career is astounding. To have advisers with economics, finance and accounting degree’s along with the ful ADFP and in many cases also the CFP quals be asked to study ANYTHING further is shambolic. I do think the number will be 50% because that as a min is the number of AR’s who will just not either want to be able to cut the mustard under the current FASEA rules. They are a joke…and yes FPA and AFA appear once again flacid participants in this debarcle.
People won’t leave in anything like those numbers. Things won’t be as bad as they seem. They never are.
That is not to say that the information that has been provided to the sector could have been a lot better thought out. Very limited information has raised everyone’s level of apprehension. Advisers are genuinely unsure. No news would have been better than very limited news. The poll results show people’s genuine frustration. Communicating to the sector should not be this hard.
Adrian, thanks for your optimistic view, i am going to copy and paste the previous comment updating with my own details
“For those sitting in their ivory towers, get a grip with reality. Only 20% or so Aussie’s engage with financial planners as it is, they are not exactly lining up to see us!!!
By the time you take into account the first free appointment, conversion rates to actual clients the cost of doing compliance Soas, fees pressure, LIF and the like you hardly break even then on top the continuous study and now the farce from FASEA, it is a joke.
You have ruined this industry, I guess that’s what you wanted.
I am 42 and have a Masters degree in commerce and an MBA, post graduate diplomas in taxation and financial planning and numerous short courses (earned with enormous personal sacrifice over the last 10 years). Yes, I know, I meet the educational criteria but it’s not worth it anymore
You fat cats that feed off us, the hangers on shame on you. Try being on the front-line and see clients. I am leaving already exploring options sadly
I’m not surprised by that number, driven by a number of factors, including
an aging adviser population, (anybody have stats on how many over 60yo advisers by 2024?), accountant auth reps with limited advice authorities not seeing the value in updating qualifications to continue the small revenue raising activity that is SMSF advice, and an ever increasing regulatory burden deterring potential new replacement advisers.
For those sitting in their ivory towers, get a grip with reality. Only 20% or so Aussie’s engage with financial planners as it is, they are not exactly lining up to see us!!!
By the time you take into account the first free appointment, conversion rates to actual clients the cost of doing compliance Soas, fees pressure, LIF and the like you hardly break even then on top the continuous study and now the farce from FASEA, it is a joke.
You have ruined this industry, I guess that’s what you wanted.
I am 46 and have A Bach degree in Management, DFP and CFP ( actual study) and numerous short courses the most recent being the TASA ones.
You fat cats that feed off us, the hangers on shame on you. Try being on the frontline and see clients. I am leaving already exploring options sadly.
Those who fail in the field go into management.
The solution is to become a non AR but be a shareholder & senior manager in one these large dealer groups with 40 plus advisers. The job advertisement states No morals or ethics required. No degree required. Must be required to swamp advisers in red tape. No point trying to give advisers degrees when we’ve got conflicts like AMP and BOLR etc. Even if the Senior Manager in the CBA tells the adviser with a Masters Degree to sell more product X otherwise he and his pregnant wife and huge mortgage will be kicked out we’ve still going to have problems. Go after the big guys.
Having been told absolute garbage by the FPA over the years and right up till recently, i was under the impression all was going to be OK. Degree qualified, DFP, advanced DFP, CFP by course work, etc, now its all out of date or not at standard. Why would you continue and possibly be told in a few years- back you go again. if saunders et al have any idea, they will look beyond their current “perceived”approach and state clearly what is going on. Not all planners have a bare 1-4, a lot have completed what was available at the time which was accepted at a relevant degree level. If I was younger I might consider further study,by the time I finished a new course i will have retired, so FUVM and add one more to the exit stats.
I have done a finance degree, the CFP and CPA courses, 20 years experience advising clients and completed ongoing PD points during those 20 years. The question is not just why it is necessary for someone like myself to go back to school but who at that school is in a position to teach me ?
Exactly right. I have a Bachelors degree, a masters degree, ADFP, have lectured on investments and compliance and have written articles and added in risk management for derivatives for Bloomberg’s hedge fund manuals, who is going to try and teach me??!! Its ludicrous to the extreme. What annoys me is that these morons are still debating what the risk only adviser will need to write life insurance, surely not a bachelors degree???!!
Yes, agree with all. Truly, this FASEA lunacy is worthy of consideration as a new John Cleese TV series for all the commonsense it exhibits. Clowns all.
You raise a good point. I’m nearly finished a Masters with a well known provider and the quality of the course has been abysmal. If advisers don’t already know most of the course material, they shouldn’t be practicing. If FASEA is determined to proceed with these education requirements, I hope they investigate the current providers to ensure what they are actually teaching is relevant and of good quality. Otherwise we will have advisers investing time and money into sub-par courses, teaching them what they already know.
This won’t end up being that high, but I’ll be leaving. I’m a 35 year old with a masters and bachelors degree in finance and investment, and I’ve been told I’ll most likely need to do another degree.
Given that the board has a large amount of individuals with conflicts (education providers), why would they do anything that doesn’t help their bottom line?
one or two units at the most imo for you Mattie.
When I last spoke to the AFA and FPA both, they said unfortunately the bachelors degree was too many years ago, and that the masters degree may help, but I’d still likely have to almost do an entire new one.
I hope one or two units, but I also thought the CFP (studied for) would help the people who took that on.
That depends Peter. Firstly, Exemptions for units only apply for subjects done within the last 10 years. Secondly Uni’s like to make money and the maximum exemptions are only up to ever 50% of the course at best, and that’s providing they are like for like subjects. So Mattie is going to have to do a Graduate Diploma in FP being 8 units but depending on what he’s previously studied he may need to do only four units. However FASEA states you need to meet certain core areas and we’re waiting to here from them how that recognition of prior learning is used.
So Mattie will need to do anywhere from minimum four units costing $8,800 to $12,200 up to 8 units depending on what he needs to do to meet the core requirements of FASEA. That could mean for Mattie enrolling in Super 101 to tick the box so to speak because Super 101 he studied in his degree is too old or it was only done at AQF 7 level as a diploma. If he did his study in the last 5 years and they are AQF 8 level I suspect over the next 6 years private firms will offer something as well.
Bad news for Mat but thank you, McGlashen, for your accurate and well reasoned response on this.
Does this then mean if you do a degree now, you need to do another one in 20 years time?
I’m in the same boat as you Mattie. Similar age with a masters degree in financial planning. I achieved top marks, but it’s worthless according to FASEA because it’s not on the FPEC list. How dare FASEA do this. Although perhaps it’s a blessing in disguise. Our profession, while important and immensely satisfying, is also stuffed. The red tape has become beyond a joke and FOFA and LIF have taken away the upside and put all the risk onto the humble adviser. Maybe this is the push I need to transition into another career.
Thats just messed up if your masters is in FP… Morons running the show.
All for cutting the dead weight in the industry (and there is plenty) but not people like yourself who did the right thing.
There isn’t as much dead weight left as you think.
Agree Mattie, have only heard that my qualifications (Bach Ec) won’t count as I completed it in 2002, despite running a successful professional business that operates intricately with accountants and solicitors for clients’ benefit. The composition of those who set the rules need to be changed, with a hard look at the facts, however as Labor and the ISA will be rubbing their corrupt union hands with glee at less future competition and obstruction to their cash cow, I have little doubt that our fate is sealed.
You’re right that things wont get any better under a Labor Govt. If Shorten gets in he’ll have to repay his cronies from the Union movement & he’ll have half-a-dozen RC’s into financial planning