The emerging adviser

01 October 2014 Jason Bernic, Old Mutual Wealth

I joined the industry in 2003 as an agent and received two weeks of product training, and was immediately told that every person I meet from then on is a potential client, says Jason Bernic, CFP® Financial Planning Coach at Old Mutual Wealth.

That was the nature of the insurance industry in those days. The Financial Advisory and Intermediary Services (FAIS) Act was new and changes were underway, but they were slow and more questions were being asked than actions taken.

It was my impression that properly written records of advice were a new challenge, and it took many advisers some time to become accustomed to the change.
According to my experienced colleagues at the time, it was not so easy to sell a policy anymore.

Seeing industry change

In the short eleven years I have been in the industry, I have seen many advisers come and go. Some make it, others don’t. Some hang on too long, and others seek alternative careers. It takes a person of character to make it in an industry that is still undergoing a legislative revolution, and that is just to perform the job of furnishing advice, never mind paperwork, marketing, research and practice management. It is a professional industry that is still finding its feet while the ground beneath it is moving.

A decade ago, the average age of a financial adviser was 55 and, looking around today, not much has changed. I do however see the more experienced generation recruiting qualified graduates and introducing them into their businesses as para and article planners. The number of Certified Financial Planners (CFP) designation holders continues to grow and businesses are aligning younger advisers with the young professional market.

Emancipation efforts

I am witnessing significant efforts to raise the financial services game and efforts to demonstrate that the value of advice over products and some practices has already made the move to a purely fee-based business.

I recently met an adviser who charges R350 to change a beneficiary on a policy, and he justifies this by demonstrating the 17 steps it takes to perform such an administrative task. His clients understand his model, and accept that he charges this amount for his time.

The barriers of entry to the financial services industry have lent itself to professionalising it. Young blood is being attracted to the industry and recruitment methods are being reviewed. Unfortunately some advisers still hop from one company to another in search of greener pastures, but the Financial Services Board (FSB) is proposing an amendment to the General Code of Conduct whereby sign-on bonuses may be prohibited. By the time you read this article, the opportunity to comment would have closed.

Forward thinkers

I find that, as our industry grows and evolves, a community of forward thinking individuals is coming to life. I am fortunate enough to consult to financial planners who are relooking their businesses and carefully considering how to elevate them.

They are researching international trends, local legislature and their own business practices, and planning the way forward to ensure their advice process and value proposition are well positioned to serve their clients’ needs and comply with the requirements of the industry. These future fit financial planners are starting to think differently, from the way that advice is given to the tools used to support this advice.

An encouraging sight

As these changes and ways of thinking gain traction, it is inspiring to witness the excitement and influence they generate; but the broker fraternity is large and somewhat set in its ways. It will take time and effort by both governing bodies and change leaders to widely influence the general practice of financial planners.

A new breed of financial planners is being born and they will shape our industry into the future, improving its reputation and attracting new, professional advisers.

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