FPA chair calls out need for simple advice
The regulatory environment needs to allow advisers to use their professional judgement and give simple advice without fear of falling foul of the law, according to Financial Planning Association of Australia chair David Sharpe.
Speaking to Money Management, Sharpe said he wanted to bring about practical changes for advisers which would help them day-to-day. Perth-based Sharpe, who had run his own practice since 2009, took over as chair from Marisa Broome earlier this month.
“Part of why I got involved with the FPA is that I’m a practitioner and I want to make sure that is appropriately represented and give the members confidence that there is a practitioner who cares and feels the same way about issues and regulation as they do.
As an adviser, Sharpe said his biggest challenge was being unable to help consumers with simple questions. He hoped the regulator in the future would allow advisers to use their own experience and professional judgement as to the amount of advice and work a client would require.
“[The biggest challenge] is when you have a client with a really simple need and you sigh because you know exactly what you could tell them really quickly but you know it would be a lot of work and you’d have to write a Statement of Advice. That is ridiculous, this is not great for consumers and it frustrates me I can’t give them the information they need in a two-minute phone call.
“As an adviser, you live in fear of ‘I’ve got to go through everything’. We need a scenario where someone can come in for simple advice, have a 30-minute meeting, receive the advice that’s important to them and leave. We don’t have a regulatory framework that allows for that and that’s what we need to solve.”
As a result, he said his two goals as chair were around advocacy and simplification.
“The regulatory environment is just unsustainable and creates so much drama, not just for us but for our clients as well. There needs to be simplification and a respect of the changes that are happening in financial planning in terms of professionalisation and educations.
“I don’t mean trimming round the edges, I mean repealing some legislation, we’ve had band aid after band aid put on until we’ve got to a point where an adviser can no longer give simple advice.”
However, despite the challenges, he still said being a financial adviser was his “dream job” and he hoped to be able to continue in the role.
“I sort of fell into a role that was financial planning and absolutely loved it and, barring someone saying I could travel the world and commentate cricket, this is my dream job
“There is all this frustration but then you have your client meetings and see the change that happens in their world because of how you’ve helped them and that makes it worth it. That's the fundamental reason why we still most of us get out of bed and drag ourselves through this compliance regime to make that difference for our clients.”
AUTHOR
Laura Dew
Recommended for you
Far too few wealth managers are capitalising on the opportunity presented by disruptive technology to deliver personalised investment solutions to the mass affluent demographic, according to PwC.
With over half of advisers using managed accounts, HUB24’s head of managed portfolios has unpacked the benefits driving their usage and how they can be leveraged by advice practices.
The FSCP has announced its latest verdict, suspending an adviser’s registration for failing to comply with his obligations when providing advice to three clients.
ASX-listed platforms HUB24, Netwealth, and Praemium have used their AGMs to detail how they are using artificial intelligence to improve their processes and the innovative opportunities it presents.
