Damage to advisers' mental and financial health 'catastrophic'

UFAA mental health Alex Vagliviello

25 August 2020
| By Jassmyn |
image
image
expand image

Industry reform has left financial advisers’ financial and mental health nothing short of “catastrophic” and these consequences need to be documented, according to the United Financial Advisers Association (UFAA).

The UFAA said documenting mental health issues could give context for legislators and industry associations to better understand the human consequences of future reform.

UFAA chair, Alex Vagliviello, said the legacy of constant change had included industry rationalisation, less competition, reputational damage, decimation of advice business values, exit of advisers and advice becoming unaffordable.

“The damage done to the sector in terms of advisers that have left the industry and their financial and mental health has been nothing short of catastrophic,” Vagliviello said.

“However, there still exists a tiny slither of time in which to bring the situation back from the brink – especially in the current environment where the services of experienced practitioners have never been so needed by so many people and businesses in financial distress. Losing advisers now would be no different to losing doctors in the face of a pandemic.”

Former adviser and industry advocate, Barry J Daniels, said one of the most disappointing aspects of reform was that the government and the industry were not acknowledging and addressing the mental health issues advisers were facing.

“Advisers are literally fatigued and the prospects of further reform the final straws – especially for mature age advisers,” he said.

“Incessant reform brought about the perfect storm that was further escalated with the demise of practice resale values and buyer of last resort arrangements that were supposed to fund retirement aspirations.

“Is it any wonder that once resilient individuals simply find themselves unable to cope?”

He noted that there was also angst from advisers with significant borrowings that funded the purchase of practices/books of clients to underpin business growth plans and provide continuity of service to clients of the acquired businesses.

“Moreover, constant tinkering with remuneration structures has seen value of practices plummet and the unjust vilification of all advisers for the sins of the few has added to distress. These factors are deterring the next generation from considering a career in advice, further jeopardising the viability of the sector,” Vagliviello said.

“Hence the need for these to be documented and put into context before embarking on further change.”

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

GG

So shareholders lose a dividend plus have seen the erosion of value. Qantas decides to clawback remuneration from Alan ...

2 months 3 weeks ago
Denise Baker

This is why I left my last position. There was no interest in giving the client quality time, it was all about bumping ...

2 months 3 weeks ago
gonski

So the Hayne Royal Commission has left us with this. What a sad day for the financial planning industry. Clearly most ...

2 months 3 weeks ago

Insignia Financial has made four appointments, including three who have joined from TAL, to lead strategy and innovation in its retirement solutions for the MLC brand....

1 week 3 days ago

The Reserve Bank of Australia's latest interest rate announcement has left punters disheartened on Melbourne Cup Day....

1 week 2 days ago

The Federal Court has given a verdict on ASIC’s case against Dixon Advisory director Paul Ryan which had alleged he breached his director duties....

1 week 1 day ago