Half out of touch with their planner

roy morgan research financial advice financial planner financial planners financial planning industry roy morgan government ANZ AXA

15 July 2011
| By Mike Taylor |
image
image
expand image

New research has revealed the magnitude of the task confronting financial planners if the Government proceeds with a two-year opt-in arrangement under its Future of Financial Advice (FOFA) changes, with nearly half of those people who have used a financial planner failing to remain in contact.

The research, undertaken by Roy Morgan Research, found that of those people who had used a financial planner only 52.4 per cent were in contact at least on a yearly basis, and noted “this suggests that the remainder are not in an active relationship with their adviser”.

However, the same research did confirm that people who used an adviser were generally happy with the outcome.

The Roy Morgan research, which also pointed to continuing confusion around the branding of the ‘big six’ planning groups and the question of independence, also suggested that commissions-based remuneration remained a major factor in the financial planning industry.

It said the most popular method of payment for financial advice was via ongoing commission, or as a percentage of investments, with 42.3 per cent of respondent who used financial advice reporting this method.

The Roy Morgan report said the next most popular method was pay per visit, with 39.6 per cent.

It noted that this figure was “not surprising given that the major licensee groups have already transitioned across to fee-for-service arrangements for clients since 1 July 2010”.

The Roy Morgan research was mainly based around superannuation, and noted that Australians who acquired their superannuation through financial planners were confused as to whether the planner they had used was aligned to a major financial institution or an independent dealer group.

“This is especially prevalent for the licensee groups owned by the ‘big six’ retail groups such as Garvan (NAB/MLC), Hillross (AMP), RetireInvest (ANZ) and Charter FP (AXA),” it said.

Homepage

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 2 days ago

Having divested its advice business in August, AMP is undergoing restructuring in at least four other departments amid a cost simplification program....

4 weeks 1 day ago

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

1 week 1 day ago