2024 adviser gains in doubt after heavy June losses
The new financial year has kicked off with lower financial adviser numbers than last year, following six consecutive weeks of losses.
Wealth Data noted that FY2024-25 is “off to a positive start” for the advice industry with a rise of 78 advisers, as more practices record their new hires but the figure is notably less than this time last year which recorded a gain of 136 advisers.
“We do expect improvement on the 78 number as updates keep coming in over the next couple of weeks,” acknowledged Colin Williams, Wealth Data founder.
Looking at the week ending 4 July, which included the last three days of FY2023-24, there was a net decline of 78 advisers. Coupled with last week’s drop of 81 advisers, the past two weeks have cumulatively lost 159 advisers as advisers switched licensees or dropped off the register before FY23-24 finished.
Speaking to Money Management, Williams said the losses over the last two weeks were “a lot more than he thought” given earlier gains. This led him to conclude that overall sums for the 2024 calendar year will be worse than initially expected despite a strong start to the year.
Back in May, it had been expected that losses this year would “not be so severe” as the same time last year was affected by the financial adviser exam and confusion around the experience pathway, which has now been implemented.
The current calendar year figure stands at -185, whereas just two weeks ago it was at -26. Meanwhile, the same time last calendar year had a less significant decline at -109.
“Based on this data, it looks like 2024 is heading for a bigger loss than 2023, which is disappointing given the positive start. The total loss for the full 2023 year was (-187),” the founder added.
There have now also been six consecutive weeks of losses in the lead up to the new financial year. In the month of June alone, nearly 200 advisers departed the profession.
Analysing the financial year just passed, it currently stands at a loss of 205 advisers. On the upside, Williams noted, this decline is “significantly less” than the previous financial year which ended in a net loss of 633 advisers.
Wealth Data is expected to provide a complete summary of the FY24 figures with additional clarity in due course as advice licensees have 30 days to update adviser details.
Weekly numbers
There are currently 15,430 advisers in the industry. Some 20 new entrants joined in the past week, while a noteworthy 246 advisers were active with appointments and resignations. Eight new licensees commenced operations and four ceased.
Examining the losses over the week, 74 licensee owners had net losses of 154 advisers in total. This was led by Insignia Financial with a decline of 13 advisers.
Fortnum Private Wealth lost 10 advisers, AMP Group was down by eight advisers and Morgans declined by seven.
A loss of six advisers was seen at both Godfrey Pembroke and WT Financial Group respectively, while Count was down by five advisers.
Both Centrepoint Alliance and Macquarie Group lost four advisers each. Meanwhile, eight licensees were down by three advisers each. Some 11 licensee owners down by two advisers each and a total of 47 licensee owners down by one each.
In terms of adviser growth, 50 licensee owners had net gains of 75 advisers in total. Vincents Advisory came in first position with a growth of seven advisers.
A new licensee commenced with five advisers from Godfrey Pembroke’s licence, while another new licensee opened with four advisers who moved from AMP Financial Planning.
Three licensees were up by three advisers each, six licensees rose by two each and a long tail of 38 licensee owners grew by one adviser each.
AUTHOR
Jasmine Siljic
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With so much uncertainty in the industry is it any wonder advisers are leaving Federal government ( Labor & Liberal) have effectively done their best to decimate the industry a disgrace from all political parties
The risk and cost just isn't worth being an advisor I suspect. I did my DFP qual about 5 years ago 'for fun' and got registered just before the 'work experience' requirement was introduced, so I could do part-time personal financial advice as a 'side-gig'. I did the FASEA exam, upgraded to a Masters degree in FP to satisfy the educational requirements (before the new 'experience' BS came in to try and retain old, stupid advisors who can't do a uni degree, even though they often already would get advanced standing from their 'experience' and just have to sit a final exam to show that they actually know the stuff they claim to have learned via 'experience'). But despite never having had ANY clients (marketing/prospecting on a part-time basis is hard) I was hit annually with PI insurance costs, AFSL fees, and ATO levy, as well as being asked to kick in money to cover the compensation scheme required due to failures of either the Big Banks shonky advice systems (now defunct) or dodgy 'advice' companies (now out of business). So it was costing over $20K pa just to remain on the FAR.... Makes no sense at all. Should be a 'user pays' system (eg. a set cost per client pa, or per SoA issued, not a blanket annual charge per FAR registered adviser...