Advice industry suffers from spike in suicides

 

Consistent and continuous regulatory change over the past decade has exacerbated the mental health of advisers to the point that more people in the industry are dying by suicide, according to Infocus chief executive Darren Steinhardt.

With only 61% of advisers passing the September Financial Adviser Standards and Ethics Authority (FASEA) exam, Steinhardt said it was disgraceful that no journalist or politician had brought up the effect low passing rates and rapid regulatory change had on mental health and suicides.

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“If you remember when Julia Gillard changed the live cattle exports, there were a handful of suicides of cattle producers and all of a sudden there was uproar around the country and things changed,” he said.

Steinhardt said he knew eight advisers directly who died by suicide linked to quick moving legislation and the disruption it had caused to their lives.

“Some of the change has been good but a lot of it has been well intentioned but absolutely misguided and it’s absolutely hurt many people who have invested heavily in their businesses,” Steinhardt said.

Professor David Crompton, a leading researcher of suicide prevention from Griffith University, said: “It is difficult to determine why people choose to die by suicide and that there are many factors influencing that such as age, family situations, history of mental illness but the fact that people are raising this as a problem means it should be critically evaluated”.

Steinhardt said he knew a couple of “good advisers” with tertiary degrees from 35 years ago that were no longer relevant who were yet to pass the FASEA exam.

“They are very good financial advisers, but they haven’t done an exam like this in a formal setting in a long time,” he said.

“Both have failed a couple of times and so the anxiety that puts on them – they’ve kind of already failed before they start because of the stress and pressures now on them.

“If they don’t get this right they’ve got to walk away – their careers are finished well and truly before they are due to finish.”

For every one person forced out of the industry, Steinhardt said another half a dozen staff who would also no longer have a job.

“They’ve got families, responsibilities for their business and staff – if they fail it’s more than them that’s out of the industry,” he said.

While there were businesses such as his set up to support advisers through the exam process, there was not a great deal of support that could be provided as there was not the staff bandwidth to do so.

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FASEA, Grad Dip, Levy, etc. Throw in these ex-dealer group "look backs" where you're told you can cough up half the so called remediation based on projects without transparency, a contract or any allegations or client complaints and you have a perfect storm. Instead of doing something constructive, our professional organisations give us all this "we're here to help" rubbish. In our practice we've accepted the inevitable fact that we're on our own, there's no help coming from outside and regulatory relief is a myth and contradiction in terms.

“rapid regulatory change“ - I’m an adviser who has also suffered from the changes, but they haven’t been especially ‘rapid’- they were flagged a number of years in advance and if anything, deadlines have been repeatedly extended, allowing a number of years’ grace

An employee I am guessing.

Nope, just someone who has done it tough in my own business in a previous life, so am used to not having things fed to me on a plate

"Ash'< surely you can't' be that blind? It's not just a single piece of legislation, it the multiple & concurrent nature of the regulatory change that's caused the current issues in the industry. Add on top of that FARSEA, that "consulted" in name only, and are the primary example of all that is wrong with the current regulatory environment. More than reasonable alternatives to implement the FASEA Standards and other aspects of regulatory change (e.g. Royal Commission) that would have achieved the same consumer outcomes were submitted, but ignored by the bureaucrats that apparently know more than the practitioners and industry associations that lobbied on their behalf. This Coalition Government, FASEA and the likes of ASIC should hang their heads in shame.

A lot of people would consider a number of years to be rapid? Especially when it comes to regulatory change

Yes many changes have been well telegraphed but reality always proposes challenges and you can't factor in what suppliers will do. One simple example, currently dealing with super providers that all have different processes for fee consent. Sunsuper for example turns off fees exactly on 12 months,....bit of bug bear given I might review a client every November and you miss out on income for a month when they turn off the fee cause you're a day late. One platform will only accept online consent, another paper and another won't accept digital signing., and another wants two factor signing.

Why not just move away from charging via product and ask your client to pay for your service from their pocket. Or is that too much of a leap for you?

95% of our clients pay us this way so don't tell me it can't be done.

Problem solved Yogi

maybe I'll take Boo Boo's advice....but for some clients GST input credits and tax deductibility within super is better.

Yogi, for those clients who we do charge their fee from product we arrange it as a once off payment, not an ongoing monthly fee.

I'd like to think those families are well placed to take legal action against those responsible for the regulatory change, including Hayne, master inquisitor of the grand inquisition for some of his misguided recommendations. Not that recompense will bring back a loved one but responsibility should be taken and those individuals and institutions responsible should be publicly denounced. A bit of jail time for some individuals would be nice for what amounts to manslaughter.

They won't, and they can't!

As a long-time suffer from mental health issues, I find this article deeply offensive. Claiming statistics (loosely) without any supporting evidence is dangerous.

Suicide is often a result of a combination of factors and singling out legislation as the pure cause trivialises the issue.

You make a good point. He quotes a range of 20-30 without a source then says he knows of 8 directly. Having said that, even 1 taking their lives due to over regulation is a national disgrace.

The persecution of financial planners in this country is a very dark insight into our culture. An undercurrent of tall poppy syndrome, jealously and nastiness. The epicentre of which is in Canberra and government regulators. But we need to look past this nonsense. To all financial planners reading this, keep your chin up. Surveys consistently show clients rate their financial planners very highly, on par with the most trusted professions. There will be very high demand and dwindling supply going forward. For those of us who tough this out, better times are ahead. Only take on clients who make you feel good and valued. Price appropriately and get some work life balance. We have the greatest job in the world, with the most amazing client relationships and a chance to genuinely change lives for the better. Best of luck to you all.

You had me laughing at "tall poppy syndrome" when it comes to financial planners. I don't think anyone with a double-digit IQ would have ever viewed a financial planner as a "tall poppy". You have most likely put a smile on a few faces though, so keep up the good work.

Hit a raw nerve by the sound of it. Tall Poppy syndrome is precisely what it is. Government bureaucrats in our division of ASIC are typically failed financial planning aspirants or law graduates who did not picture their life on a relatively meagre wage, living in a cold, boring city like Canberra. They have high IQ's but a twisted perception of the world and low EQ, and are frustrated at their own failure. They satisfy their jealously by attacking those of us who are able to achieve a life they couldn't. We have amazing client relationships, our clients trust us highly and rave about us. We aren't sitting on gravy trains like they think, but compared to these bitter, twisted bureaucrats, we earn very good money. Yep we are tall poppies. Maybe not to you, but to those who matter in ASIC, APRA, treasury, FASEA and minister's offices, yes we are.

You had me laughing again at your government conspiracy against financial planners ran by law graduates. But then you had me in stitches with "our clients trust us highly and rave about us". All I was waiting for was "you've been a great audience, thank you and good night" and I would have given you a standing ovation. Please keep going.

The joke is on you. There have been several studies overs the years (all reported here on Money Management) which have surveyed financial planning clients. All have shown high levels of trust, on par with the most trusted professions. Even the major banks had client satisfaction levels of around 80% (which is exceptionally high). The mistrust in the non-advised community has been damaged by industry fund advertising, the media and ASIC (which has deflected attention from their failures by attacking us), but it does not reflect the actual experience of clients. Keep up the great work everyone and ignore fools like this.

Keep 'the funny stuff coming. 14.73% of people know you can make up any statistic to support your case. Weird that you have gone from government employed law graduate conspiracy theory to the industry funds marketing conspiracy theory? The material is expanding, keep the laughs coming.

maybe it's just you.

Maybe it is, maybe it's not!

Only someone with a low EQ, bordering on psychopath would laugh and ridicule comments on a page discussing financial adviser suicides

Some posters have questioned the article, some question a comment. It's called freedom of speech. If there was more freedom of speech and questioning with the financial planning industry about its' practices over the past 25 years, would the industry be where it is today, going through all this rapid change to drag it into the 21st century?

Freedom of speech. The go-to excuse for trolls who don't have the IQ to present a well reasoned argument.

At least George Orwell is funny!

Actually there are a lot of groups and people with tall poppy syndrome against planners, isa, choice, asic to name a few. Why else do they cut us down at every opportunity? Some of them are failed planners , or those without enough guts to be an adviser, they are the worst for tps.

Well that was poor attempt at a government conspiracy theory. Are you George Orwell's twin (but not so funny) brother?.

No I am not, I am a financial planner, who are you? Just a troll with lots of time on your hands? How sad

Who am I? I'm a tall poppy and not a financial planner!

A tall poppy anonymous troll, how nice for you to have the best of both worlds. Congratulations on achieving such a inspirational work/ life balance.

Thank you. You are not as funny as George Orwell either. Ask him to write you some new material.

if you think you are a tall poppy, you probably aren't. my guess would be failed, lawyer or accountant.

can you tell us your profession, my guess is failed, lawyer or accountant? (probably a grandfathered accountant, of the CA variety)

please confirm your esteemed status for us all.

You are a bit repetitive. My profession and status? Very tall poppy and double-vaxxed.

I gather it's a lot better to be a failed lawyer or accountant, than a failed financial planner. Failed lawyers and accountants are few and far between, but failed financial planners are a dime a dozen. And don't those failed financial planner bleat about their lot? They go on, and on and on....

Id much rather be a failed anything than a nasty little troll. You lot are really the scum of the earth. To troll an article about suicide is really as low as you can go. How could you possibly get fun from this? You are a bitter and twisted person, please go away and consider if this is the way you want to spend your time. If it is please seek professional help as soon as possible as there is something seriously wrong with you.

And a new contender enters the race.

Thanks for your concern, but I'm fine.

Next...

just answer the question fool. what is your esteemed profession? enjoying working from your mother's garage today? it's going to be hot so get some air conditioning, you can get it from HN over 60 months interest-free.

Good to hear your second job at Harvey Norman is going so well CFP. Sign me up. And keep up the good work.

Promoted myself to Extremely Tall Poppy this morning.

Well said George. Just reminded me of the most recent peer reviewed Academic Research from Griffith University that 100% support your comments about Advisers and adding Value, trust and financial well being, mental health being higher., than non advised clients. Not being "on par with the most trusted professions" but actually being higher. The study being applied to Australia. Shame the regulator wants us all to work at Hesta.

You're not HESTA material!

The beauty of your anonymous commentary is the linkage you provide yourself to real world entities and sectors. This rubbish gives an opportunity of people like myself, who is anonymous to you, to show the general public this is what Industry Fund activists are about.

How's that been working? Not so good?

I actually left a very similar firm...After two years I got sick of the script... Step 1, repeat back to client their problem. Step 2. say the solution to (insert problem...eg debt reduction, saving tax, wealth accumulation) is salary sacrificing into ABC fund. . Step 3 hand out additional contribution form to add money to Balanced Option. or Growth Option.

Liam Cormican, if the content of this story is true and I have no reason to doubt it. Then it is beholden on the FPA and AFA to immediately act! I mean this is appalling!!

This is great, finally somebody is putting it out there what we have been hearing for ages that people are committing suicide because of these Stresses.
Add to that, the bank aligned dealer group suddenly closes its Doors to business and you have to find a new home in a quick period of time and complete a new statement of advice for every client you service on an ongoing basis at a cost of approximately $100,000.
Then attempting to explain to our client why we legally have to give them a new SOA, at our cost, which as most of them say they don’t really need it as it doesn’t say anything different than the last SOA they received.
This whole period of change has certainly created a feeling of being alone, and that everyone is coming after you, and it really is not a healthy environment.

Imagine the public response if 30 Doctors had taken their own lives as a direct result of the incredible pressure and continuous stress applied by Govt regulatory impact and unreasonable and unworkable conditions.
Four Corners would be on to it in a flash.
Four Corners wouldn’t give a second thought to Financial Advisers being driven to suicide as a last resort because it would it would be in opposition to the left wing biased agenda.
300 Financial Advisers could take their own lives and you wouldn’t hear one word from Minister Hume or Josh Frydenberg because the reason is they actually don’t care.
It’s simply not important to them.

I fail to see the point of this article. It sounds like a naive rant just to get your name in the paper. I am truly sorry for all those advisers and their families and their staff who have been forced by all this change to look in the mirror and ask the question whether they are going to have a place in the new world. Structural change is truly hard and like we've seen with many other industries, some individuals make that very sad choice feeling there is no way out for them. But to make up a number to get a headline is disappointing - is it 30? Is it 20? Or something else? The actual number is irrelevant because the real crux of the story seems to be a plea for the advisers that were relevant 35 years ago but can't pass an exam. The efficacy and usefulness of the exam has long been debated but we've known for years that in order to stay in this industry, you need to get through the exam, and there has been a lot of flexibility provided with two extensions given. Is the plea about hanging onto the "good old days" so older advisers can do what they've always done (which govt and regulators have judged over many years was not adequate which is why we've had to endure all this regulatory change)? There is an admission that the industry will be in better shape in 12 to 18 months so what does that say about the 20 or 30 or some other number that have unfortunately made a very sad choice? Is there a call to increase funding to mental health providers so they can better assist victims of structural change? No? The industry will not go back to where it was so I don't see the point of the article (and its poor form to throw around numbers of people dying to give yourself a platform for a rant).

Is the plea about hanging onto the "good old days" so older advisers can do what they've always done (which govt and regulators have judged over many years was not adequate” good point.
Agree that some of the changes have been difficult and not all are well thought out (or even just plain stupid). But we shouldn’t be in the business of protecting life-insurance salesmen under the guise of a bring a ‘professional adviser’ if they’re not prepared to learn

Ash
Please read my comment forgot to aim it at you

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