Don’t unnecessarily punish degree holders says FPA

20 December 2017

Financial planners with degree qualifications and who are Certified Financial Planners should not be needlessly penalised under the new arrangements being pursued by the Financial Adviser Standards and Ethics Authority (FASEA), according to the Financial Planning Association (FPA).

Acknowledging that the FPA’s phones had been running hot in the wake of last week’s announcement by FASEA of proposed mandatory education pathways, FPA chief executive, Dante de Gori said while his organisation had been a strong advocate for the imposition of a minimum degree qualification under the new regime, he believed FASEA needed to be pursuing transitioning planners towards obtaining a degree rather than penalising those who already had a degree.

Sitting at the heart of the FPA’s concern is the degree of focus on the Financial Planning Education Council (FPEC) guidelines which de Gori said did not even exist when many current financial planners actually obtained their degrees.

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“Just because a degree is not on the FPEC list does not mean it should not be counted,” he said, adding that matters should not be driven by the universities.

De Gori said the FPA would using the consultation period attaching to the latest FASEA announcement on mandatory education pathways to argue its point and to lobby for the appropriate recognition of degrees.

He said the FPA believed that completion of the work necessary to obtain the Certified Financial Planner (CFP) designation, when taken together with a degree qualification, should be capable of providing a pathway to FASEA recognition.

The FPA has not been alone in fielding a high level of planner inquiries, with education provider, Kaplan, also confirming high levels of contact.

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Perhaps Dante might like to answer this question - why is the FPEC list so narrow in the first place? FASEA has effectively copied what the FPA has already done with their own education council. Perhaps the FPA could help us by releasing a full list of all non/pre-FPEC courses they have individually approved for entry into the CFP program? Better still, they could add these courses to a supplementary list, saving their members from the ridiculous process of applying for 'pre-admission' along with the $75 fee.

The FPA is too focused on protecting the CFP trademark and the millions they make from the CFP program. Meanwhile they've missed the bigger picture. Many advisers have degrees, post graduate qualifications and diplomas in finance and commerce related subjects and they are practically either now worthless, due to their age or at best may gain a few exemptions from a Graduate Diploma of Financial Planning. A poor reward for those advisers who attempted to lift standards in the industry. Many of these advisers will either 1) leave 2) pass the cost onto clients 3) cause a major distraction from serving clients and time with family and out of the office. Finally the advisers of the future will know more about when to hand out and FSG as opposed to having an ability of reading a company with the narrow and specific requirement to have a Bachelor of Financial Planning.

my Masters in Applied Finance, CFP ( studied), DFP ( studied) may not be relevant - meaning I have to go back to study, yep, Financial Planning.

Yogi, I have a bachelor of commerce majoring in financial planning, and it's not list of approved degrees. FAESA have drawn the net so tight it's ridiculous.

Imagine if accountants were told that they need to redo their study as their Accounting degree from 10 years ago is now worthless.

Where do you get the list from?

This whole process is a joke. I'm all for lifting the minimum education standard, the current situation of needing a 4 subject Diploma is also a joke, but how can they have deadlines in place for when we need to meet the new standard but they themselves have no idea what credit existing Advisers are going to get for previous study and experience. I have a degree in IT and Information Science and a Grad Dip in Applied Finance and Investment along with numerous individual courses - when do I find out whether I need to trot off to Uni to get another Degree??? which I wouldn't do, I'd just sell up and do something else. Madness.

yes, just worked out the 22 year old who works for, been in the industry 12 months, has a Commerce degree ( FP) and will do his DFP this year, will be able to advise clients sooner than I will. I have CFP/DFP, Masters App Finance and 30 years experience!

I'm going to have to do a Bachelors degree or a Masters, because none of my qualifications meet the narrow FASEA guidelines.

I have the following:

Diploma of Financial Planning
Bachelor degree in Finance & Economics
Master of Business Research
Master in Applied Finance
Chartered Financial Analyst (CFA)

All up I have 13 years of university study in finance and related fields and I'm not qualified to be a Financial Planner! Seriously, that is ridiculous.

You and many advisers have been shafted by broke and poorly run Australian Universities looking for more fee income. You should get some exemptions but at best it will only be 4 of the 8 subjects required. You'll still need to do some further study at the AQF level 8. I guess $10K all up (just bill clients perhaps?) and you'll end up learning nothing more than elementary & basic concepts. I hope you write to FAESA and your local politician because what they've done to experience and well qualified advisers like you is an absolute joke and an insult.

It's just bizarre that they can't comprehend how diverse financial planning is. A background of experience in different industries with fantastic qualifications now can mean very little. They want a Financial Planning specific degree. That is just weird...and yes, an insult. A finance related undergrad or post grad degree along with DFP should have been enough, but oh no...let's shaft almost everyone. Good luck getting any RPLs, they don't like handing those out any more.

Thankfully i have Masters of FP (and it's on the list - phew), but seriously....a masters in applied finance and a CFA should crap all over it. These education proposals will limit an advisers ability to look at other suitable careers down the track. The FASEA committee should be sacked and start again. What where they even thinking?

I think you will be fine Steve. The current framework is narrow but is still up for consideration. Secondly, the proposed framework allows for bridging courses (for which there will no doubt be many) as well as the ability to complete additional individual units of any degree to make up for missing content (which is something accounting students have done for years to become CA/CPA if they dint complete a full accounting major at uni).

Given your extensive (though mostly investment focused) academic background, you may have to just complete a few advice strategy subjects + ethics over the next 6 years (though you may well get an exemption for ethics given your CFA status).

For now, relax.

BB, now is not the time to be relaxing. I certainly hope you don't think the FPA is going to come to our rescue. Steve needs to get off his butt and email the Minister NOW, otherwise it will be back to school for him. FASEA have put out their meaning of a degree and Steve and many others with degrees older than 10 years of age will not count. Steve will need to do at least 4 subjects of a Grad Dip costing $8K to $10K. If you think some cheap two day or 3 month course from a privately run institution will meet University determined AQF 7 standards I think you're clasping at straws.

Just a stupid concept. If you want to control something you measure the output (the thing you want to control) in preference to the input. So set an exam which measures the competence of the adviser, don't ask them to redo an education course, and waste decades arguing about what course is acceptable, and how old can it be. We all get measured on what we do now, not what we did 10 or 20 years ago.

3 months ago it ADFS+ CFP + CPD would be sufficient according to the FPA, Now its a degree + CFP. The FPA is clutching at straws...But give them some leeway, they are literally scrambling to stay relevant and thereby stave off their own extinction.

FPA on announcement "We will also be supporting members through the transitional period, and advocating that those who have obtained the CFP® designation have this recognised as an equivalent qualification."
So the FASEA board have obviously rissoled this - interesting to note that the FASEA board has ex FPA people and CFP's - hope they all have their other qualifications in order? Also academics, whose uni's stand to benefit from degree enrollments - no conflict there.

Hi Max,,..sorry to disappoint you, but CFP not worth the paper its written on now..its a certification not a qualification i read earlier.....happy new year.

It's a real shame that the good quality Fin Planners out there are yet again being hung out to dry by toothless industry bodies such as the AFA and FPA. Imagine the uproar the AMA would have if they said 'sorry, you got your degree when it was free, you can no longer practice'?

The solution is clear - hire a 22 year old Grad while you get accredited, make them the Auth Rep of your business and change your title to Associate Adviser. Any issues they get hauled over the coals by ASIC and you can come back in when the dust settles.

Remember guys these are only proposed, make sure you give feedback to local members and other pollies. We cant take something like this laying down, there is no way I am taking more time off work at this stage of life to redo a uni double major , DFP and my annual CPD points are enough! Its not our fault the government accepted DFP 1 to 4 as enough to be a adviser, many of us did uni courses anyway as we wanted more knowledge about finance and economics and so forth, we were ahead of the curve. I think everyone agrees new advisers need to have a degree, even existing ones should be at degree level, but those that already have a degree done in say 2000 there is no way they can be forced to redo this after years and years of practising with no issues. It seems FASEA wants planners that are more educated than the people that work at FASEA and ASIC put together, they want potential brain surgeons to perform rollovers and tailor insurance policies and do estate planning. Oh you got a A in ethics you will be a great adviser even though you hate picking up the phone and actually speaking to people...really? Do the accountants that give smsf advice also need to redo thier degrees or do a new FP one, can you imagine the blow ups? No, we wont take this lightly at all, tell everyone you know its unfair to existing advisers that have worked really hard to be at the top of their game. Put the submissions into your members and professional organisations, put pressure on where you can, then if worse comes to worse we need to get of our backsides and go and protest in Canberra! Stuff it why not everyone else does and they get changes made!

I've sent info to FASEA Board members. What concerns me most is that they've done this to people just as we want to go on a break and refresh - they set this out. It's very poorly communicated and timed and they should be ashamed.

What is interesting is none of the politicians making these calls have degrees in Political science, and very few of them have any sort of education to do with the portfolio they hold, yet feel the need to sprook/hide behind the "in the public interest" mantra. As always, those living in glass houses are throwing stones...

I wholeheartedly agree with the recommended education standards. Essentially the requirement is to have a degree relevant to financial advice, not broking, not accounting, not finance etc etc. I anticipated this change several years ago and now meet these new standards without taking time off work. 6 years to complete something that can easily take 2 is really not asking that much.
As I am sure you are aware, on 1 July 2016, the Accountant's exemption to provide SMSF advice was repealed. Therefore, Accountants can no longer give personal SMSF advice without being an Authorised Representative so they too would have to meet any new education standards.
CFP should also never be relied on as an appropriate level of education unless the standards dictate that it is CFP without exemptions, particularly when they use to hand out that designation without any education requirements at all.

Interesting point re the SMSF licensee's needing to meet the quals, not sure that will have dawned on them yet, or even on FASEA, who may need to have a separate quals list, narrowed to only SMSF studies.

Financial advice needs a understanding of economics and finance as a grounding, ethics was already taught in most business degrees pre 2014 if you take the time to look over the subjects much of the content is very similar. We need to stand together on this not try and push those out that are already keeping clients happy. Time to unite over this not point score.

Totally agree with the many arguments put forward, however the argument with FASEA will be like having an argument with your mother-in-law that you will never win. It will have a significant on many people internal and external and the ultimately the client. Valuations of business will decline as the client just moves elsewhere. Loyalty between client and adviser is earned and respected not just from waving a piece of paper.

Dante de Gori would say this after its obvious that FPA members were again sold a pup in the past. This again just shows what a waste of time and money being a member of this irrelevant body who nobody listens too and is controlled by the instos.

If you own your own business - just hire some upstart that can give advice and make them the Authorised adviser. Nothing to stop you sitting in the room, talking to your clients and giving factual information while you chip away the qualifications.

All care no responsibility for advice and away you go!

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