Vanguard urges consideration of Govt-funded advice service
The Federal Government has been urged to give further consideration to a publicly-funded and independent financial advice service, similar to that in operation in the United Kingdom.
Vanguard Australia has responded to a Treasury discussion paper by directly referencing the UK’s Pension Wise service which enables people aged over 50 to access free and impartial service stating that it has been consistently welcomed by UK consumers.
“While a government advice service will not on its own be able to fully address the advice gap in Australia, we support further consideration of the benefits and implications of a government-offered advice service to supplement existing advice channels,” it said.
High up in its response to the Treasury discussion paper, Vanguard said it supports “urgent progress on reforms to the safe harbour, statement of advice and intrafund advice rules as measure to streamline and assist with the affordability of personal financial advice”.
Further it said that it recommended the Government undertakes consultation on improving data sharing between Government agencies and superannuation funds, employing a consumer-led consent model.
The Vanguard response said that the company had long supported the benefits of personal financial advice “whether the advice is delivered through intermediated channels by professional financial advisers or by a product issuer offering guidance”.
“We believe advice should be accessible in different ways to suit diverse consumer needs, preference and circumstances, and that advice should be affordable in terms of delivering long-term value for the cost incurred,” it said.
The response said that single issue advice or limited advice is commercially unviable for many financial advisers and advice providers and that Vanguard Australia advocates for the statement of advice requirements to be replaced with technologically neutral disclosure requirements that allow flexibility and should improve customer understanding and implementation of advice”.
I would have thought that the solution is very, very simple.
Cut the ridiculous level of red tape (which in fact helps nobody) and the cost of advice could be significantly lowered tomorrow.
The industry is broken, primarily as a result of over-regulation.
And at the same time the time to service a client reduces significantly.
Advisers should be able to see 2 to 3 times the number of clients currently able too.
The only reason Advisers can’t is the morons in Canberra, Pollies, Regulators, Conflicted Super Funds and So Called Consumer Associations are ALL the Red Tape Warriors that have totally STUFFED Advice for most consumers / clients.
Vanguard – the only international asset manager who doesn’t allow their clients to trade listed Bitcoin ETF’s and they think a gov run ‘advice’ service is needed? Of course they do.
Thanks for the tip. Now I like Vanguard even more
OMG so now all financial planners are going to be in competition with free advice from the government? When will the pain ever end? Can’t the government just give people a tax deduction for advice, without continuing to destroy the financial planning profession?????
Free advice from the govt for low income consumers is actually a much better option than “free” conflicted advice from product companies, which is Jones’ preference.
The government has a choice between providing free financial advice or solving the homeless problem. Personally I’d rather they looked at the hard problem of homelessness.
Fixing financial advice is quite easy — make advice fees deductible (which they should already be), change opt in to opt out or at least come up with an efficient method of charging fees and reduce the paperwork needed for initial advice. I’m yet to meet a client who is less confused after getting an SOA than they were before receiving one.
Homelessness is a problem from Labor’s mass immigration program. Allowing over 700,000 immigrants in one year, just so Big Business political donors benefit from depressed wages, is the reason rents, house prices and homelessness is up.
The fix is simple; no more immigration until there is no homelessness.
Socialist thinking from Vanguard – “we support further consideration of the benefits and implications of a government-offered advice service “
Perhaps the government should instead look at providing a free index fund to be available for all Australians?
Nah, because in my view, if you do that then you have the Government using all of the voting rights of the underlying shares to push woke stuff on to corporate boards (even more so).
Like the unions are already doing through their control of “Industry” funds.
I like Vanguard and their low cost products.
What does worry me as an Advisers is that in the US that are direct competition to Advisers these days.
Massive push to compete against Advisers, so do Advisers want to support that business.
Their personal investor and super platforms were built without adviser access. That should tell us all we need to know about how they view advisers. The only created access after realizing they had no source of fum.
Good point, but no disrespect.
You are comparing a direct ETF channel to Financial Advice.
That is the same as referring to McDonalds as a restaurant.
Different things for different people.
I may not have worded my comment well.
But go check out the Advice services from Vanguard direct in US.
Steak for Steak mate, direct competition funded by the vertically owned Investment Products.
I’ve seen how the government manages the money that I am forced to give them, and they are the last people I would take advice from!