Disagreement on professional impact of ‘experienced pathway’
Implementation of the ‘experienced pathway’ risks delaying the transition of financial planning to a profession by up to a decade, according to Fiducian executive chairman, Indy Singh.
Speaking on a panel during Financial Newswire’s Platforms, Wraps and Advice Technology conference in the Hunter Valley, Singh said he was opposed to the Government’s proposed measure because he believed degree qualifications represented a cornerstone of professions.
However, he said he accepted that the existing Financial Adviser Standards and Ethics Authority (FASEA) regime needed to be amended to recognise a broader range of degrees, particularly those relevant to stockbrokers and investment advisers.
Stockbrokers and Investment Advisers Association chief executive, Judith Fox disagreed with Singh and said she believed that the ‘experienced pathway’ represented a sensible measure aimed at overcoming mistakes made by FASEA, particularly with respect to recognising experience.
WealthData principal, Colin Williams said he agreed with the need for recognition of a broader range of tertiary qualifications in circumstances where he, personally, held a Masters of Finance qualification which was not recognised under the FASEA regime.
Williams also produced data which confirmed that a significant number of advisers held tertiary qualifications which were not recognised under the FASEA regime, validating the need for the Government to act to broaden the regime.
Former Madison Financial Group general manager, Jaime Johns said she believed that the experienced pathway was acceptable but understood the resistance from some elements of the financial advice community.
I wonder if there will be a class action case for the people who left the industry based on FASEA – as a result of this backflip.
Not all advisers looking to use the experience pathway have only ever done RG146. The full DFP8 plus CFP and SMSF studies, accreditations in gearing, aged care, margin lending, ETFs, etc are the base education standard for most older advisers who did every minute of study available to them up to 2004.
add on 20 years of experience and still keeping a business afloat, and these people are now around 60 years of age.
if you are over preservation age then you should get the experienced pathway granted, as most likely the cost benefit analysis of the extra study outweighs what you basically have as muscle memory when it comes to working out strategies. I have seen the Grad Dip and I wouldn’t pay to do it. The old DFP was closed book, only a financial calculator and a hand written exam in part. You had to know your topic inside out to pass that.
if they let us sit a challenge exam for the Grad Dip subjects I would do it. It’s a grab for cash from fully qualified and experienced advisers.
limit the experience pathway to those over 60 and add a ten year sunset clause. Everyone else has time to do the study and should do it.
Meantime stop whingeing about the FASEA exam. It was a piece of cake. If you have experience that is.
Full Advance DIP completed over 3 years part time study via FPA / Deakin Uni, and with 30 experience in the industry working with FP’s. This is not good enough to become a financial planner if I wanted to. What a joke!
I agree with all of your points except the 10 year sunset condition, it should be 5 years. If anyone hasn’t started on their Grad Dip by now didn’t want to work past 2026 anyway. With a 5 year clause and even if you hadn’t started, at 1.5 units a year, you would finish the quals in time to practice for as long you want. It’s more than disrespectful to those who rolled up their sleeves and parted with cash to do the study which I’m sure most would agree has been a benefit to them and their clients. The old expression of ‘if you think your the smartest person in the room, then….’ comes to mind, which is what I feel a lot of experienced planners think they are and therefore it should be a walk in the park.
Licensee’s also have an invested interest here, less advisers means less fees for them and potentially increasing them for those remaining, forcing more to consider the self licenced option. Ultimately, direct licencing is where we should be going and a fully qualified, professional industry will only help this. Paying licensees to collect revenue and put on PD days is a thing of the past. Name another industry that operates this way? Mortgage brokers I hear you say?? surely we are better than that! Inbuilt commissions and no service? Been there, done that…
Let’s get this done and focus on regulatory reform to get better outcomes for clients and us!!
What I think is more disrespectful is your consideration that our experience has less value than the degree. Personally, I think 40 years’ experience (and a clean record) should hold the same weight as a degree anyway, however for you to think your degree is less valuable than our experience is ludicrous.
I agree with the Age 60 idea, but Sunset clause? Not at all… Personally, I’m 63 and want to continue practicing for the rest of my life (at least at this point in time). Most of my clients are good friends as well, so why do I need to change the relationship with them? I don’t need to retire. I tell clients that what they want to do in retirement is a personal thing for individual people, and this “work” is retirement for me!!
“Reject the good for the perfect”. It’s the Greens again from 2009. Those comfortably in the “educated” pool are seeking to control the numbers in the pool. Just like the medical specialists who want to stop overseas graduates from practising in Australia, resulting in some of the most overqualified GPs in the world.
Surely the advocates of banning the Pathway can see the consequences of their advocacy – and the impact on mature risk writers like myself. According to some, there are just 500 specialist life risk advisers left. One thing I do know for sure, is about 95% or more of those risk specialists would be well and truly over 65. At the risk of being accused of hubris, we are a special breed, we’ve been through the tough times when you start a risk business and we don’t want to leave. And the industry shouldn’t want us to leave, because if we do, around 25% of our clients will lapse their policies (easy to do with the current gouging of premiums) because we, the mature risk advisers, are not there to convince people that still need to manage their risk.
The consequences of market failure in the life insurance industry is too horrible to contemplate. And it constantly amazes me that the harbingers of doom in the not-for-profit super funds do not seem to understand that if the statutory number one funds, normally consisting of a majority of fully underwritten fresh new lives, should teeter on the edge of insolvency or capital inadequacy, then every bit of super default group cover in this country will no longer exist. The life insurance pools in this country are not what they used to be.
Especially when the government made that vandalistic law requiring youmger Superannuation members be “Opt in” rather than Opt out!!
This is a sideshow, and its interesting that a licensee would hold this view.
It wont be a popular comment but the single biggest impediment to financial advice being a fully fledged profession with a real limited liability compensation scheme (just like accountants and lawyers) is commissions and product based fees. I dont know the answer – LIF has totally stuffed the insurance segment and the ability for people with lower means to get insurance advice (which will ultimately increase the welfare bill in this country), but for us to be a true profession with all that entails we, the advisers, need to find a way to get appropriately paid without product based fees and commissions. This is what we – advisers – should be discussing and trying to work through, not whether someone with significant experience but without something called a “degree” – even though not from a real university – is professional or not.
No, product fees are not what is stopping the ‘profession’.
A lack of cohesiveness and childish bickering between self-interested factions, while running directly diametrically opposed to us and in perfect harmony & synch, are union super/AIST/AIS/CHOICE/ASFA and the numerous ‘voices’ that the left have set up to ensure we’re drowned out and irrelevant to politicians and appear as bumbling corrupt fools via the public media.
No other ‘profession’ such as the accountants, lawyers, medical, engineers etc, have such a powerful nemesis, whose hold on literal billions, as per rivers of gold, depends largely on how poorly we fare as a group overall.
If the organised crime called Australian unions & the socialist left were never permitted to get their corrupt hands into superannuation, there’s a far greater chance that by now we would be closer to achieving that particular titular aspiration.
I agree completely.
The reason we’re not considered a profession to date is because over the last 20 years or so, we’ve laid down and accepted every draconian change the government has impeded us with. That doesn’t build respect, all it does is give them more incentive and potential to bully.
If we (with the help of the Associations) put up some sort of a fight against the crap they’ve thrown at us, and really provided other input to the issues they had, maybe we’d already be a profession at this point in time.
To all the educated elitists… work with our experience to make the profession, not against us!
My undergraduate degree was in finance and my postgraduate in financial planning.
The courses covered were distinctly different and it would make no sense to start approving finance, applied finance, economics, or any other degrees which do not delve into the relevant legal frameworks of the financial planning profession I.e. superannuation, insurance, ethics, corporations act, etc.
Responding to the article, the activities of stockbrokers are often at odds at what is considered best practice with regards to investing, diversification etc, and their business model cannot be reconciled with existing ethical frameworks for financial advisers. Hence, they should not be afforded a carve out, especially one that is clearly not in the best interests of consumers.
The experience pathway is also a carve out. I’ve been supporting an experienced adviser with tertiary studies and it’s not that bad. It’s taken many years of studies for me to get a foot in the door and people are complaining of doing as few as 5 more subjects. In all these years complaining (soon to be 5+ years at this rate), one could have easily finished these subjects doing only 1 or 2 per year.
I can just imagine the thinking at Treasury when these proposals are being reviewed by Degree qualified public servants.
“no longer meets community expectations” what part of that does an Adviser without a degree not understand ?