Bad publicity hurts consumers equally
Bad publicity against the advice sector has hurt the consumer as much as financial planners, by discouraging them from opting for professional financial advice, according to C2G Financial Services.
The Chartered Financial Planning authorised representative's financial planner, Louise Bennett, said while regulation and education was vital in financial advice, it was time to move on and encourage people to keep track of their cash flows and budgets, and to ensure they had financial protection.
"The media has had a field day with advisers now. I think it's time for them to move on. It creates confusion so consumers don't understand the value of advice. They just hear the bad stories," Bennett said.
"It's actually prevented people from sitting in front of a qualified adviser, getting good advice and improving their situation so instead they do nothing."
On the positive side, Bennett observed that consumers were more aware that they needed to pay for advice, whereas there was previously an expectation that it would be free.
"I think that could've been in the past because the industry funds offer can give a product with no advice. I think it's a good thing to move away from product to advice so people get advice and they distinguish between a product and what a financial planner does, which is strategy and advice," Bennett said.
On the looming accountants' exemption deadline to attain an Australian financial services licence to advise on self-managed superannuation funds (SMSFs), Bennett said accountants had an opportunity to open a financial planning section in their business but warned this encompassed all the regulations that came with giving advice.
"It's not just a walk in the park for the accountants so they need to make sure they take the decision seriously. It is definitely an opportunity in many ways for accountants and planners to work together and have good referral relations," Bennett said.
"At the end of the day I see it as one field with two specialties: tax and advice, and the two working together."
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