The number of financial advisers could fall to 14,000 in the next couple of years, according to Association of Financial Advisers (AFA) President Sam Perera, but this presents opportunities for those who remain.
Speaking at the AFA roadshow in Sydney, Perera said many advisers had struggled with the red tape and regulations needed to run a financial advice business.
Adviser numbers had been declining over the past few years since the Hayne Royal Commission and were expected to fall to 17,000 this year.
“We suspect we will see 14,000 financial advisers in the next couple of years,” he said. “This is down from 26,000 in 2018, we are a dying breed and that is really sad. In those numbers, we have lost some good, hard-working people who were great advisers.
“We have seen a number of great advisers leave because it got too hard, it’s been unrelenting. It’s been hard since the Royal Commission but even before that, we had to deal with compliance and red tape.”
He highlighted the mental health toll that the changes had taken on the industry. Research last month found more than 80% of advisers said the changes had “significantly” impacted their stress levels.
“The mental health toll is very confronting, it has been very hard and now it is being realised outside of the sector as well. Firms have had to adjust their business model by merging or selling up and adjust for the new evolution of financial advice practices. But you are not alone, your peers have also been finding it hard.”
However, he was hopeful the Quality of Advice Review would help the industry turn a corner and said the AFA would be making a submission encouraging work on best interest duty, annual renewals and recognition for prior learning.
He concluded: “Where there is complexity, there is need for advice and that has never been greater. We will continue to work to give you the policy settings for you and your business to thrive”.