Membership of the Financial Advice Association Australia (FAAA) has declined at all levels over the past year, according to its 2023 annual report.
The organisation’s report, which covered the period from 1 July to 30 June 2023, found there was an 11.7 per cent decline in membership during 2023 from 10,954 members to 9,670.
This loss is 75 per cent higher than the losses in 2020, which were recorded at 6.6 per cent. Since 2019, the organisation has declined by almost a third (30.4 per cent).
The FAAA was officially formed from a merger of the Financial Planning Association of Australia (FPA) with the Association of Financial Advisers (AFA) in April, but members didn’t transfer to a FAAA membership until 1 July. It said members who joined from 1 July as a result will be reflected in next year’s report.
Data from the ASIC Financial Adviser Register (FAR) in August found there were 7,851 financial advisers who were members of the newly-merged FAAA organisation reflected in the FAR, although it noted more could still be in the process of finalising their membership.
While there has been a steady decline in adviser numbers over the past few years, according to Wealth Data, the number of overall advisers in the Financial Advisers Register (FAR) fell by 3.7 per cent in FY22–23. The number of financial advisers fell by 599 from 16,183 to 15,584 in the year.
All FAAA membership categories experienced losses (practitioners, affiliates and CFPs) during the period.
Practitioner members now include financial planners and provisional adviser members, following a change to the membership system. The other two member sections are CFPs and affiliates, which include members who are retired, students, leave of absence and academic affiliates.
CFPs are down by 7 per cent from 4,966 to 4,615, compared to a 3 per cent loss in 2020.
“The membership categories most impacted were the practitioner category, with members experiencing the impacts of factors such as changes to education standards, plus changes to business models and the ongoing impact of onerous regulation. These factors have resulted in a number of financial planners continuing to leave the profession,” the FAAA said.
While there have been overall positive steps in increasing the numbers of new entrants, FAAA student affiliates have declined from 995 to 989.
There is a strong bias towards Victoria and NSW at 29 per cent and 32 per cent respectively, with just 6.9 per cent in South Australia and 2.1 per cent in the ACT.
Would be interested to see how many FChFp dropped off.
To be honest I personally will be considering my renewal next year as I feel FChFP’s have not been given the recognition they deserve following the merge.
Why would anyone want to join this organisation ?
Before the merger, for many years both the FPA and the AFA left their rank and file out on a limb so that anyone that came along with a chainsaw had no qualms about using it, whilst these two happily sat and watched.
Despite rhetoric to the contrary, there are still further good advisers planning to leave the profession over the next 18 months.
I would read that as a very positive sign for the Adviser Profession moving forward.
It is sad that the two associations couldn’t exist, that’s was a commercial reality though.
For me , if I’d wanted to join the FPA I wouldn’t have joined the AFA.
When it’s all said and done, it wasn’t a merger, it was a take over by the FPA of the AFA.
That’s why I didn’t renew