Experienced advisers are choosing to exit the financial planning industry due to the new education requirements when there is an overwhelming need to address complex financial issues among senior clients, according to Mentor Education Group.
Mentor Education Group founder and managing director, Dr Mark Sinclair, said there was a considerable vacuum of expertise in the provision of quality financial advice to meet the pre, and post retirement needs and longevity risk of senior clients.
“Far too many planners have decided that the regulatory requirement for academic qualifications is a ‘line in the sand’ and their cue to turn their backs on a career and advice practices that have many more productive years ahead,” Sinclair said.
Senior clients are going to need advice on various aspects including addressing sequencing risk, making nest eggs last the distance, superannuation and strategies to bridge the financial longevity gap.
“This need is going to increase drastically as more and more Baby Boomer workers and business owners exit the workforce and find themselves facing a myriad of often complex and bewildering issues and challenges to address in retirement,” Sinclair said.
Sinclair said advisers who were contemplating exiting due to the new educational requirements should change their thinking as the commercial benefits far outweighed the downsides.
“The reality is that existing planners still have time on their side to complete a bachelor degree by the 2019 deadline or undertake studies in other fields that can allow them to be of service to senior consumers facing a rapidly growing and complex number of financial related scenarios,” Sinclair said.
He also warned of the consequences of a sudden reduction in the number of financial planners that would affect tens of thousands of clients and hundreds of small business owners, and the effect on employees of advice practices who would have to be shed.
“It simply makes no sense when there is both a growing consumer demand and market for the services of experienced planners – as well as practical and workable alternatives to selling an advice practice at fire sale prices,” Sinclair said.
