Is an adviser ‘finishing school’ an answer to PY burden?
A financial adviser has suggested the use of a financial advice ‘finishing school’ to relieve the burden of the professional year (PY) from advisers.
Super Innovations principal, Joseph Climi, said a finishing school would provide robust regimented practical training for soon-to-be advisers along with an allegiance to an oath of duty, similar to lawyers and doctors.
Climi said those who completed the training would be more well-rounded and practices would be more encouraged to take on advisers, which could lead to less compliance during the PY.
“They’ll reach a competency stage where they can leave the course and hit the practices running and they won't be this massive burden of practices to go through the compliance over a 12-month period,” he said.
“There might be a three-month period of supervision to make sure that because the college will give them a more rounded education in insurance investments, and estate planning, and so forth.”
Climi said because small practices either did insurance, investments, or a mix of both, PY advisers were not all-rounders unless they did their PY at larger practices with four or five advisers.
“My belief is that we better tackle the PY year now and get the young ones in quick smart. In 2026 it’s going to be another bloodshed,” he said.
“Because if we don't who wants to go into financial planning? For one, they won’t have a good career path, no respect at the moment until it builds up in later years, and are unsure how much they're going to get paid.
“The other thing with financial planning is it is not just insurance or investment as it is so broad. There are so many components and intricacies that exist, how can you expect an individual adviser that's been in the industry for 20 to 30 years to teach them all that stuff?
“They’re only limited to a certain level of experience and that's what they’re going to teach. These advisers need to be taught right across all spectrums and to be wary of the traps that are involved when they get out there.”
Climi said if a training school were brought in, it would be a “big relief” for existing advisers and perhaps the 12-month period could be reduced to around three months as it would complement what they already had in place.
Climi said he had taken the idea to the Financial Adviser Standards and Ethics Authority (FASEA) that said it would pass it onto Treasury. However, he noted that the idea had likely been put to a committee but had been stalled.
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