Consumer education key to financial advice credibility, says Paul Barrett
The entire financial advice industry needs to work to educate consumers with financial know-how to be considered credible, according to ANZ general manager of advice and distribution Paul Barrett.
Money Management on Friday misinterpreted Barrett's message contained in an address to the Actuaries Institute's Financial Services Forum as suggesting independent financial planners and industry funds were at an advantage in this area.
However Barrett instead said that independent financial advisers, industry super fund planners and banks have shifted their focus to providing finance knowledge to consumers and need to build their reputations around that service to be considered trustworthy.
"There's an emphasis change. To be fair dinkum and credible in the advice industry we need to build reputations based on knowledge, based on qualified people on the front line imparting really good knowledge to consumers," he said.
Barrett warned that any financial planner who didn't focus on providing that knowledge and service to consumers would lose out.
Barrett acknowledged that bank KPIs were now focused on the quality of financial advice that was given, as well as meeting customer needs.
Barrett also questioned why a consumer who visits five different financial planners for advice would get different advice from each of them.
If advisers are asking the right questions and listening properly to the client, the client should get roughly the same strategic advice from all, Barrett said.
It was naive to hope for exactly the same advice, because the differing chemistry between client and adviser meant that financial advisers couldn't always get all the information, he said.
However, there should still be some degree of consistency, he said.
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