EOFY sees largest weekly adviser exodus at 549

The last week of the financial year saw 549 advisers exit the industry, with losses dominated by accounting-based advisers as many believed paying additional fees outweighed the benefits of providing personal financial advice, according to Wealth Data.

The firm’s director, Colin Williams, said additional fees levied by the Australian Securities and Investments Commission (ASIC) was one of the key reasons accounting groups called ‘time on their foray into advice’ along with the need to pass the Financial Adviser Standards and Ethics Authority (FASEA) exam.

Williams also said that the data released overnight on 30 June, 2021, was unlikely to have captured all the movement as licensees had up to 30 days to report changes in their adviser numbers.

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“Given lockdowns and the need for licensees to work through the changes in what has been a busy week, we may see additional losses in next week's reporting as licensees catch up,” Williams said.

Following that, AMP Financial Planning regained its top spot as the single largest biggest financial group in Australia, a status  the group once lost at the start of the year to SMSF Adviser Network (SAN), owned by National Tax and Accountants Association (NTAA).

This week SAN led the losses in adviser numbers recording a departure of 91 roles, and was followed by IOOF (-45), Easton Group (-32), AMP (-30) and Synchron (-27).

Source: WealthData

At the same time, IOOF managed to remain the largest license owner with 1,437 advisers ahead of AMP Group which stood at 1,367, and NTAA with 669 adviser roles.

Source: WealthData

Looking at the financial year as a whole, the size of the industry dropped by almost 11% with a loss of 2,364 roles.

As far as peer groups were concerned, the investment advice group sector with advisory firms focusing on portfolio advice held up the best with a 2.2% drop in adviser roles, while the financial planning sector which includes firms with a focus on holistic advice was down by almost 10%.

At the same time, accounting-limited advice groups that mainly had a focus on limited self-managed super funds (SMSF) advice posted the highest fall in adviser roles at 23%.

Source: WealthData

This week also saw 24 licensees owners post growth with a total increase of 32 roles, 19 licensees closed which led to a total loss of 51 advisers, and two new licensees commenced out of IOOF-owned Lonsdale with a total of six advisers.




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What a sad day.

Accountants aren't "calling time on their foray into advice". They have just wised up to the fact that being a licensed adviser makes you a target for ASIC persecution and extortion. These accountants will go back to giving unlicensed advice and will be completely ignored by ASIC.

Auditors always tell me, if it is not documented, then it did not happen.

ASIC's role is to monitor and enforce the law. they cannot take action against those who are not under their remit or supervision.

if you are silly to accept the terms to be a licensed financial planner (and I mean that very sincerely) then you can't keep blaming others who (one might argue wisely) choose not to be under the microscope for review and management of every word or utterance.

it's virtually impossible (it may be possible but highly impractical) for an accountant these days to have a conversation with a client without overstepping the mark as they may have a general conversation in the course of their dealings with a business owner for example, and may inadvertently venture into 'credit assistance' or 'financial advice'

you can hardly blame them for knowing better. the issue is with the complexity of the laws and their prescriptive regulations, not the people exiting. what did dirty harry say? "a man's (or woman, or he, she, they) got to know his limitations".

So you see no issue with knowingly breaking the law? Good to know where your moral compass points. It won’t take long for the remaining, degree or degree equivalent FP’s to be held in extremely high regard by their clients and colleagues. Accountants have seen the writing on the wall with their business model being slowing eroded from all sides by technology, regulation and other industries. I know many of them that are getting mortgage brokers, equipment finance guys and general insurance agents in so they can clip the ticket on their referrals. Good ones will thrive, but with xero/ato data matching etc, they need to build out a rock solid advisory piece to remain relevant. Even then I see that role going to highly skilled FP’s these days who specialise in business financial plans.

ladies and gentlemen, this is the beginning of the death spiral.

adviser levy will increase to 4-5k per adviser next year, which will cause many small advice firms (and still a few limited license holders) to decide to close, which will cause many smaller licensee groups to fold, which will cause even more exits and so on and so forth. major consolidation is already underway with IOOF and AMP who will reduce their headcounts.

we got a big one coming at the end of the calendar year. KABOOM!

the ORACLE, the only one who predicted a 5,000 population of advisers. the only one!

I predicted 4,679 a few years ago!

....and that my fellow advisers is when the RC Lawyers, Politicians and Regulators will see Financial Advisers truly charge fees like "Professionals" do......in timed 6 minute blocks. They wanted to "Professionalise" our craft (their words) and so the unintended consequence will see those remaining advisers charging fees (like lawyers) to service only the wealthy, and then sadly, the lower and middle market will have to go sort themselves any way they wish (i.e. Centrelink Financial Information Service). Advisers services will cost what they cost, and if clients cannot, or are not prepared to pay what it costs Advisers to deliver advisory services in a commercially viable manner......."Thankyou Sir - Goodbye - Next Please".

Correct!

Can we please start classifying Financial Planners and Stockbrokers in two different groups as they do two completely different things. For example, Morgans group in the table above has 474 'Adviser' roles. Morgans are primarily stockbrokers not financial planners. There needs to be clarification around this so we know the true extent of the Financial Planner exodus. Then we will see how much of an ORACLE you truly are with your 5k prediction.

Computer says no.

we also need to have the number of limited license holders and those on the FAR who are in supporting roles and are not client-facing advisers.

also get rid of timeshare people (persons, what do you call them?)

limited afsl holders who can advise on smsf only for example

stockbrokers

I think it will easily get to 5,000

Me too buddy. That is because it is becoming clear that there was never actually anywhere near the number of " Advice Document" presenting financial planners that we were lead to believe there were (ie. around 28,000 a few years ago). It was probably more like 10-15k financial planners and we will easily shed 5-10k of these people in the next few years.

do you think a name like "Qanon" is suitable and appropriate for a relevant provider to use. you have breached std 2 (part a), std 10, and std 12.

a relevant provider must always act to realize and promote the values of :

trustworthiness, competence, honesty, fairness, diligence.

a breach is itself a breach if it is not reported. I think you need to self-report to your licensee and then they can then report the breach to ASIC, because if the licensee then doesn't report the breach, then that is a breach too.

self-report, please.

I am a former employee of the FS industry, its so sad to see this great industry which is full of great people doing great things, continue to go down the drain.

Many more lives will be financially ruined as a result of this, than those that will be ruined by people genuinely doing the wrong thing.

I hope the government wake up to themselves before this industry is too far gone.

Just wait for the numbers to come out this week.

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