There is a dark side to the changes impacting the financial advice industry – the deteriorating mental health of those advisers caught in the pincer of a tightening regulatory environment and declining business valuations.
That was the assessment of former financial planner and founder of PFM Australia an Alliton Capital, Barry Daniels, who warned of mental health distress brought about by industry reform fatigue, constant legislative/regulatory changes and reputational damage to financial services.
He said these factors were contributing to many advice practitioners making the decision to terminate their careers and exit the industry.
However, Daniels said the situation was not being helped by the Government and the industry failing to acknowledge the very real mean health issues being faced by financial planners and their families.
“The prospects of further significant industry reform beyond the Hayne Royal Commission that followed the Trowbridge Report, Life Insurance Framework (LIF) and education requirements has exhausted many – especially mature age planners,” he said. “Hence the decision that sees so many capable planners preferring retirement to continuing their careers.”
Daniels said that adding to their distress was the fact that planners seeking to exit the industry were selling practices in an environment of rapidly falling values for advice businesses.
He said many planners, equally, had structured their retirement plans on resale values or Buyer of Last Resort (BoLR) arrangements to fund exit and retirement aspiration only to find these plans were now in tatters.
“Business brokers can attest to the mental anguish and tears of planners not only concerned for their own well-being, but those of their staff and the ongoing financial servicing of clients,” Daniels said.
Comments
The decade long relentless attack on the financial services industry and financial advisers is now culminating in significant mental health issues for so many honorable and ethical people.
The sense of declining self worth, loss of self esteem and confidence and the dismantling of a business they worked hard to create, drive and build (often from nothing) is creating no benefit whatsoever to the many clients that have relied on and who continue to rely on the service, care and advice these people have provided over many years.
Clients work with people they like ,trust and value their judgment and who show empathy and concern for their well being.
The Govt, in it's pursuit to wind back retrospective legislation made in good faith to make a political statement not based on accurate assessment and comparison of client impact or best interest is the catalyst for significant anxiety .
Their consideration for the impact on small business is non existent, but what they don't really understand is that if advisers are not in a healthy place and their mental well being is depleted, their ability to deliver the level of service advice and care to their clients is also compromised. It is unfortunate they do not care at all and advisers feel they are simply worthless.
It becomes very difficult for advisers who are known for delivering high quality client care to continue to do so when they are in need of care for themselves.
There are a plethora of self interest parties who simply brush this impact off as disruption and change that will happen in all industries and to answer the call for reasonableness with an attitude of "get over it and adapt or die".
Some, but not all of these harsh comments do sometimes come from a breed of adviser who seem to dismiss the foundation work and establishment of the industry they now benefit from.
Whilst various business models should be allowed to operate in unison, the vitriolic nature of ideological positions does not serve the industry or the clients well at all.
The current situation is now resulting in symptoms of mental illness which in turn effects families and relationships.
Most unfortunately, the overwhelming nature may well result in the worst possible outcome.
This is incredibly serious.
Thanks Agent 86 You summed it up well and only missed one point. I am burnt out totally. My ethics were to serve all who need assistance regardless of their value and in todays climate i cant survive to do that. I would have to be selective and it compromises my whole lifes values in climbing the ladder of success and making sure it is against the right wall. tyhe results ive seen will in helping clinets will cease and they will loose. Its a given, as some of these results were based on us finishing work that other planners didnt even bother with, and getting claims paid on policies that had lapsed year/s prior. Just had to prove the condition was diagnosed then. Those clients didn't even know they once had the cover. All these good stories are finished and so is my mental state.
Well said Agent 86...i'm cooked..as hard as i swim the torrent gets stronger and i, my business, my retirement are washed away...thanks to all the self interest groups that helped get us to here. I am still swimming but the arms are getting tired. Not sure what happens then????
Then you use your legs Anon, keep swimming eventually you will end up on the beach. We are as whole resilient people, there is light at the end of the tunnel just need to keep positive. Catch up with a friend , have a drink , say stuff it the worlds against me but I can face any challenge, laugh it off then go back and do what you do best, help people. There is no better feeling than that. Every morning I say to myself I can face any challenge, it works if you say it enough times! Take care.
Good on you 'Hang On', your comment made my day :
paper today, pharma companies paid min $62M this year to an array of nurses, doctors, psychiatrists, physios etc etc, How is this any different than trailing comms? They rely on their ' professionalism'' and best interests responsibility to remove bias despite the payments. Not sure how different we really are then.
bit like taxis plates going down in value. poor business model and poor service outcomes lead to falling values. Gov softly softly changes to laws back 13 prolonged the problems..
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