Confidence in planners still needs work
INVESTORS continue to be sceptical about the quality of financial planning advice and that vested interests are being promoted by the advisory market ahead of the needs of investors.
In response to this, many investors are becoming more informed and educated and are acting on their own investments without taking financial planning advice, a situation which is causing problems for planners and investors.
These two pieces of information were drawn from the most recent Assirt Investor Trends Survey and presented to delegates at the recent Securitor and Pact conference in Bali by Assirt Research chief executive, Krystyna Weston.
The survey, according to Weston, found that investors felt advice from one provider was often in conflict with that of another and was not independent but under control of groups such as the banks.
Despite work by adviser groups, investors also felt the planning industry had low barriers to entry and that “qualifications were readily available from the sides of cereal boxes”.
“Most investors are content but are not enthusiastic with the level of advice they are receiving. They feel they need to make informed decisions in a complex market but do feel more satisfied after receiving advice, so this is something good for the industry,” Weston says.
The other area of concern, according to the survey, is commission-based fees.
Weston says the overwhelming feeling from investors was that commissions removed independence from the advice process.
AUTHOR
Jason Spits
Recommended for you
High-net-worth clients with between $5-10 million are found to have the greatest unmet advice needs, according to LGT Crestone, with inheritance planning viewed as the most-sought after help.
The advice industry is in an “arms race” according to minister for financial services, Daniel Mulino, around the use of technology in superannuation switching scams such as Shield Master Fund.
Advisers are now serving more ongoing clients, according to a CFS report, but efficiency limitations continue to hinder the 82 per cent looking to serve more.
The FAAA is hopeful the education and experience pathway deadline will be the “last big thing” that could cause an adviser exodus but concern now turns to advisers moving to the wholesale space.
