Currently, there were 16,203 advisers on the Financial Advisers Register (FAR), down from over 26,000 in 2019. This was in contrast to a rise of 8,500 advisers between 2015 and 2019.
Last week, it was announced there had been an exit of 172 advisers from the industry and gains of 23.
If exits continued at this pace, there could be zero advisers in five years, Rainmaker said, which was scenario one.
Alex Dunnin, executive director of research at Rainmaker Information, said: “All projections for adviser numbers point to no recovery without profound structural industry policy change”.
However, there were three other possible scenarios which would see the adviser number remain in positive territory.
Scenario two, which ignored the boom-bust period between 2015-2022, posited there could be about 12,000 advisers in 20 years.
Scenario three posed what could happen if the rate of percentage fall continued at its three-year levels that averaged a loss of 14% and would see less than 5,000 advisers in 2029.
Scenario four postulated that if the number of registered financial advisers fell only 5% p.a., by 2042 there would be 6,000 financial advisers practicing in Australia.
“While these are predictions at this stage, they serve a purpose; they reinforce that the current trend of advice industry exits is so baked-in that it is naïve to expect a recovery in financial adviser numbers anytime soon,” said Dunnin.
“This irony is that while financial advisers are strategically less important, the successful remaining ones are now much more important because in a wealth management market that is violently disrupting, funds managers need effective financial advisers more than ever.”
What a ridiculous article. These people cannot predict what 20 weeks will bring never mind 20 years. Just look back to say 2012 or 2015 and see what was written about the future of the profession and industry. I wonder which special interest group this sort of information is serving?