The majority of financial advisers believe RG 146 is an inadequate minimum entry standard and that a tertiary qualification requirement should be introduced, according to a Tepana Associates survey.
The survey of 175 advisers conducted in October revealed that 62 per cent agreed with the Financial Planning Association’s consultation paper, which requires all new financial planners to have a tertiary qualification as a minimum requirement to ensure they can provide advice on financial goals and strategies. A further 72 per cent believed that RG 146 was inadequate as an entry-level qualification to provide investment product advice.
Almost two-thirds felt that financial planning and the context in which advice was given — such as the economic environment, operation of financial markets and products — needed to be covered in more detail.
Tepana Associates lead consultant Kathleen Tepana said financial planners must demand minimum entry level education requirements as well as post-study transitioning or internships if they wanted to see the financial planning industry become a profession.
“A lot of advisers believe a relevant tertiary qualification is a necessary prerequisite for the industry because of the fiduciary responsibility of planners and the potential for significant risk to the financial wellbeing of investors,” Tepana said.
“Indeed, some advisers believe so strongly that it will enhance their professionalism that it should apply to all planners, not just new planners,” she said.
Tepana said many of the advisers surveyed believed RG 146 was too broad, basic and easy to achieve, and did not adequately prepare a new entrant to give adequate advice to a client. Practical work experience was also seen as an important prerequisite to setting up a business and operating as a fully-fledged financial planner.
Tepana said advisers described RG 146 as superficial, and too focused on product rather than strategy, adding that financial planners wanted to see enhancements in the level of training across all subjects.
In terms of continuing professional development (CPD), the survey found that two-thirds of advisers were satisfied with the adequacy of industry-based CPD education to keep them up-to-date and aware of changes and industry developments.
