Advisers facing higher workload amid 1.6k education deadline exits

The exit of as many as 1,600 advisers as a result of the education requirements will fundamentally redefine adviser capacity, Padua Wealth Data says, and leave clients facing longer turnaround times and reduced access to advice.  

With just one month left until the education requirements kick in, the research house is predicting a loss of almost 900 advisers as the “best case” scenario but numbers could be much higher.

Based on a point-in-time analysis of the Financial Adviser Register (FAR), founder Colin Williams found there are three core segments of advisers; those who intend to use the pathway, those who will not do so and those who have not yet declared their intention.

Some 5,179 advisers say they currently intend to use the experience pathway.

For those who don’t qualify, advisers are required to meet a higher standard of education and successfully pass the ASIC adviser exam in order to continue operating after 31 December 2025.

According to the analysis, 6,469 advisers have declared on the FAR that they won’t be using the experience pathway, 91 per cent of which meet the incoming education requirements. The combined 11,648 advisers are expected to continue operating into 2026.

However, the remaining 3,811 advisers have yet to indicate on the register which pathway they intend to rely on or if they intend to stay in the profession at all.

Of this group, 1,523 advisers potentially qualify for the experience pathway, and an additional 1,396 advisers have qualifications that Williams said indicate they may progress toward 2026, though he said this group remains highly uncertain.

While incomplete records make it challenging to determine how many advisers may exit as a result of the new requirements, Williams said the “best case” would see 892 advisers leave the profession, bringing the total down to 14,567.

“When a series of ‘what if’ scenarios are performed, the net loss can easily jump in excess of 1,600. Adding together the most realistic outcomes across all categories the net loss range will be between 1,100 and 1,500,” Williams said.

If 1,600 advisers were to leave, this would bring the profession down to just 13,859 and place extra pressure on what is already a stretched profession. It has been widely commented on that there is already a supply-demand imbalance in the sector with the number of consumers seeking advice outstripping available advisers.

A smaller profession would mean such as increasing the client load of the remaining advisers, creating longer turnaround times for clients, exacerbating the advice accessibility issue and putting increased pressure on the cost to serve.

All was not lost though as Williams noted that there are some factors that could impact this number considerably.

Namely, he said December traditionally sees a resignation spike and experience pathway advisers could fall short of their requirements due to service period being checked. It is also likely that there will be last minute FAR updates as the deadline approaches which would disrupt the current predictions while the November financial adviser exam results could see a surge of new entrants to combat some of those expected losses.

Some of the losses may also be temporary as advisers have the option of dropping off the FAR ahead of the deadline in order to complete their education requirements and later rejoin the profession.  

The FAAA revealed in August that this loophole allows advisers to avoid the need to redo their professional year (PY) as those who remain on the register but don’t meet either requirement will be required to do so in order to continue practicing once they complete their education.

Weekly movements

Looking at the weekly movements, the profession saw a net gain of just one adviser in the week ending 27 November, bringing the total to 15,459, bringing the net change for the calendar and financial year-to-date to a loss of 12 and gain of 289, respectively.

With the addition of 10 new entrants, this signals the loss of nine experienced advisers this week, building on growing concerns as some career advisers look to exit in the coming weeks.

Meanwhile, two licensees commenced operations this week while none ceased. Some 27 licensees all saw a net gain of just one adviser, including Spark Partnership Group, Shartru, Rhombus and both new licensees.  

This marks another week of small shifts after the week ending 20 November also saw no licensees with a net gain of more than one adviser.

At the other end of the spectrum, Sequoia Group was down by net three advisers after one left to start their own licensee while the remaining two are yet to be appointed elsewhere.

Four licensees lost net two advisers each, including Godfrey Pembroke with both switching to Findex, Cobalt Advisers which saw one move to RI Advice, River X losing one to Advisory Circle, and Capstone, with the rest of the advisers yet to be reappointed elsewhere.

A short tail of 14 licensees lost net one adviser each, including Entireti and Akumin, Finchley and Kent, and Shaw and Partners.

Among those that gained net one adviser this week was Centrepoint, pulling in close as the third largest advice group with 587 advisers, falling just behind Count Limited with 589. Entireti and Akumin Group remains the strong frontrunner at 1,104 advisers under its AFSL.