What will financial planning look like by 2030?
The financial planning landscape, provided the recommendations of the Productivity Commission and the Royal Commission are executed in totality, will look very different by 2030 and there will be losers and winners, according to a study by online advice portal wealthdigital.
According to the firm’s chief executive, Wayne Wilson, advice in general would be driven more strongly by consumer needs than product solutions.
This would mean that planners who were willing to move into transactional models would need to embrace new advice service offerings such as aged care advice and debt management advice.
At the same time, those who decided to remain on current revenue sources, such as insurance commissions and advice fees relating to retail super, would see their margins dwindle.
“We expect a dramatic change in planner demographics through a combination of forced exits, new entry standards and significantly reduced practice valuations. The era of the career-changer is coming to an end,” Wilson said.
Additionally, the biggest industry super funds would be expected to monopolise, he said.
“Their intra-fund advice services will be the dominant source of pre-retirement, non-SMSF super advice to consumers. This will extend into retirement advice in line with the progressive direction of retirement income stream policy,” Wilson said.
However, retail funds run for-profit would suffer under the Productivity Commission’s recommendations on efficiency in the superannuation industry as active investment strategies inside compulsory super funds would be replacing by index-tracking funds management.
Wilson also believed that self-managed super funds (SMSFs) and investments through managed accounts would remain prominent in the future.
AUTHOR
Oksana Patron
Recommended for you
Insignia Financial has announced a board director will be stepping down next year after almost a decade amid a board refresh.
Zenith Investment Partners has appointed a Brisbane-based business development manager, who previously led Fitzpatrick Private Wealth Partners as a director and senior adviser.
Praemium has said it is open to investing in artificial intelligence “in a big way” as it believes it can transform the business and details how it is already being used by the firm.
Sequoia has shared its strategic initiatives for FY25, including organically increasing its licensee market share and restructuring its specialist investment arm.
