Almost a third of the Top 100 dealer groups pay their planners exclusively via a salary, with another 12 dealer groups offering a combination of salaried and con-tract employment.
Almost a third of the Top 100 dealer groups pay their planners exclusively via a salary, with another 12 dealer groups offering a combination of salaried and con-tract employment.
This statistic has enormous ramifications for the industry, says KPI Research’s Leo Wassercug.
“Salaried advisers are clearly a trend that is strengthening. This gives the dealer more control over the adviser and ensures there can be no argument over owner-ship of the client,” he says.
Traditionally, it has been the banks that pay their planners on a salaried basis and the rise in the percentage of salaried planners is indicative of the banks’ push into the industry, Wassercug says. Each of the Big Four banks have planning groups hired on a salaried basis — among them Commonwealth Personal Bankers, Westpac Financial Services, NAB Financial Planning and ANZ Financial Planning.
He also argues that many stockbroking-based firms have similar remuneration strategies. Hartley Poynton, Morgans Financial Planning and JB Were, three of the bigger accounting-based firms in the Top 100 engage their planners on a salary.
However, not all of the salaried dealer groups in the survey were newer entrants to the market. Some of AMP Financial Planning’s advisers were paid on a salaried basis and MLC’s Garvan Financial Planning and MLC Private Client Services (as opposed to MLC Financial Planning) were engaged likewise.
Almost half of the dealer groups in the survey — 47 to be precise — engaged plan-ners on an independent contractor basis. These dealer groups were the more ‘tradi-tional’ industry players, such as AXA Financial Planning, Lend Lease Financial Planning, Godfrey Pembroke, RetireInvest and Hillross Financial Services.
Wassercug also noted 4 dealer groups employing planners on a franchise basis. “A few groups have started formal franchises, but this is a trend that’s not particularly prevalent.”
However, two of the top five dealer groups in the survey operated under a fran-chise arrangement — Count Wealth Accountants and Colonial Financial Services.
Interestingly enough, four dealer groups would not disclose how their financial planners were engaged.
