A bright future for financial planning

19 April 2022

Money & Life team

Money & Life contributors draw on their diverse range of experience to present you with insights and guidance that will help you manage your financial wellbeing, achieve your lifestyle goals and plan for your financial future.

With three months under her belt as FPA CEO, Sarah Abood reveals some of the key messages members have shared with her.

Since joining the FPA, I have been connecting with as many members as possible. I’ve been keen to hear about the concerns and challenges facing you, and what your priorities are for how the FPA can help. I’d like to share two of these points that many are raising: the decline in practitioner numbers; and regulation of the profession.

New entrants

Interestingly, members are telling me that consumer demand for financial planning services has never been as high as it currently is. Many members are actually overwhelmed by new client enquires, which is great for many practitioners (although a concern for those who have started closing their books, as they no longer have room to service new clients!)

I do view this trend as a positive for our profession, because the demand for financial planning is clearly there and is growing.

However, on the supply side, members are concerned at the rate in which practitioner numbers are falling, particularly at a time of growing demand for advice. The FPA is addressing this in several ways: by supporting members and new entrants with the Professional Year requirements, as well as working more closely with students and tertiary institutions with mentoring programs and career pathways. This includes getting the CFP® Certification Program built into the Masters of Financial Planning.

We’re also working with Government and regulators to clarify the education standards as soon as possible, and supporting existing planners doing further study with our ‘Return to Learn’ resources. We have mentoring programs and scholarships specifically to encourage more women to enter the profession, which will help with numbers directly, as well as helping our profession be more representative of consumers. That said, I think more action on this front is needed and we are working with multiple stakeholders on what more we can do.

Over-regulation

Members are still dealing with the perennial issue of regulatory overreach, and compliance complexity. They remain extremely frustrated with the amount of different, and sometimes conflicting, regulation they need to deal with.

This over-regulation is a huge focus for me and the team at the FPA. There are a number of opportunities to advance the cause this year, including the Quality of Advice review, the Australian Law Reform Commission review of the Corps Act, and via advocacy around the Federal Election.

We are also regularly developing and releasing a number of tools and guides that will help members comply and deal with the regulation as it currently stands.

Hopes and expectations 

Probably one of the biggest opportunities I see is the willingness of Government and regulators to hear what we have to say about the challenges you are facing when dealing with regulation. It’s heartening to see these key stakeholders willing to work constructively with us to try and make things better for financial planners. They recognise how important financial planning is for the future of this country, and how important that service is for consumers.

We’re also looking at how advice businesses and the profession are changing, particularly with the exit of many large providers from financial advice. Many more practitioners are now working in small to medium sized licensees. This means the focus of what we’re doing at the FPA needs to change to reflect the changing needs of our members. We’re increasingly looking at how we can support members in the business of advice, as well as the profession of advice. This includes looking at services that will support you as a small business operator, as well as an advice professional. 

An exciting future

If there is one message I’d like to share with you it’s this: the future of our profession looks really bright.

More and more Australians are seeking the help of financial planners, and demand has never been higher. Our ability to truly transform people’s lives for the better is increasingly recognised and needs to be celebrated. Law-makers are acknowledging how important financial planning is. They understand that changes need to be made to make it easier to deliver great quality and affordable advice to more Australians.

As a profession, we have a future we can truly be optimistic and excited about.

Over the coming months, I look forward to speaking with many more members about the future of our profession and how the FPA can help you.

 

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