We are being told by Government and ASIC that we are presenting a chaotic front to them. They don’t really know who represents the industry and they don’t have a consensus on what the priorities are. This gives them a perfect excuse to just run with their own agendas on what needs to be done and what the priorities are; and they are not matching up to the reality of what advisers are dealing with.
Do we all need to be part of the one Association and present a united front? Maybe, that’s not my call. I think Advisers have a right to have differences in the way they wish to work and operate. And it makes sense that there are different Associations with a different focus for members.
So what is that all Financial Advisers should unite over?
Instead of fighting over who has the best fee structure, or the right to be called independent, who has the biggest adviser network, who offers the best product suite, whose association is bigger or better, and who is superior out of wholistic advisers or specialists in their field, how about we all agree on one thing?
The one constant should be that clients are better off after seeing a financial adviser. People seek financial advice because they don’t know all the answers themselves. They have a problem (or problems) to solve and they are seeking solutions when they see a financial adviser.
The only advisers who are deficient are the ones who are not making clients better off. This is what the industry needs to remember and unite over. This small but dangerous portion of the adviser population are the ones who are bringing the industry down. When I review advice for clients and give them opinions and questions to go back to their adviser with, there is no silver bullet for which type results in the best or worst outcomes.
Being independent, or charging flat fees instead of percentage based, being self-licensed or being a member of a particular association is not resulting in better or worse advice overall. It is the care, research, strategies, communication, and outcomes that make advice good, ordinary or bad.
So, how about, instead of making a big deal about how good you are or how bad someone else is just because they do X or Y we just judge each piece of advice for each client on whether it makes them better off? If a client is happy they will tell someone else. If they aren’t they will tell multiple people and the consumer groups will use them as a megaphone. That is the reputation issue the industry has.
I would love to see you tolerate any other advice provider’s methods as long as the client is better off.
I want to see you rage against the few doing the wrong thing by their clients.
It’s time to weed those thorns out to save the rest of the crop.
A lot of advice problems have multiple possible solutions and there is sometimes subjectivity in which one is recommended. Get over it. Move on. Call it out and refer it on as FASEA requires if it is not a one-off mistake and is about negative client outcomes. But it’s time to be very, very quiet if it is just about a view of how you think someone should do something. Present a united front for good advice and a united bombing raid against bad advice.
ASIC and government have a fairly obvious agenda that they want scaled back and piecemeal advice offerings as their solution to the problem they have decided we have. They think this is the answer to advice affordability and complexity of regulation. We all know that whilst that service will suit some, it doesn’t suit everyone and certainly not your most engaged clients.
If you want the regulators, consumer groups and Government to provide relief any time in the future, everyone needs to get good advice, not just the lucky majority. Unite and support each other in providing this real solution regardless of method; and take action if you find someone who genuinely doesn’t.
Melinda Houghton, Insider Out
No there should have been a merger of associations years ago, it’s just a fact the lobby groups as they currently stand are not as effective as they should be
Thanks Melinda, with the Banks leaving the advice space things have improved greatly already.
Simple getting ripped of with less commissions
Ooops! Melinda, of course… 🙁
Nicely considered and thoughtful article, as always, Melissa, but let’s not forget that “scaled back and piecemeal advice” does have a place for many consumers, who want to buy in stages, rather than an all-in approach. We can walk and chew gum at same time. Offering both options and explaining pros and cons of each (and there some on both sides) is the professional approach As long as we deliver what we promise – no less – and for a fair price (i.e consumer IS better off and preferably bettr informed, after taking our advice) then we’re not at risk of complaint, nor of too heavy-handed regulation. But regulation IS necessary, as long as there are some doing the wrong thing. Agreed – calling out (and reporting) unethical or harmful (and systemic, repeated) acts is what we all should do for those (few) who will otherwise create the climate of fear and loathing that brings over-regulation.
Great article Melinda. On your call to shout out against those doing wrong against clients, we need to weed out FPA members. They are the ones doing wrong by their clients. Accepting of their CEO’s conduct at the Royal Commission and putting up with an industry association that is following someone else’s agenda, ( a product provider) which has ultimately lead to advice that is beyond the price of ordinary Australians is shameful. If we get rid of FPA members we’ll be doing good.
Well said!
There are far too many people pursuing commercial and personal agendas in the industry. Just adhere to FASEA’s Code of Ethics – it’s not rocket science – and everyone will be better off as a result.
Agree 100% The posturing and self promotion of advisers has been counter productive and non sensible. Eg A client with a $5 million dollar SMSF will have completely different needs to a retired couple with $500k trying to survive on their super and age pension. Completely different value propositions. There are endless complaint about ASIC and dealer groups. What I detest more are the self righteous self promoters who believe everyone should do what they do.
…your balanced and thoughtful perspective is always appreciated, Melinda. Thank you.