Sydney-based boutique financial planning firm, Financial Spectrum, has launched a financial planning practice start-up and training program.
Regulatory reform and market pressure on smaller financial planning groups has resulted in increasing consolidation of the sector, and banks and larger institutions are reaping the benefits. However, Financial Spectrum has launched its Incubator program, aimed at providing an alternative for financial planners who do not want to go down the institutional route.
The Incubator program aims to attract financial planners seeking to set up their own business - with or without their own Australian Financial Services Licence - and provide them with the support and training to start up successfully.
"The main aim is to allow these experienced financial planners to test the water of running their own firm, and start immediately building up the client book (and therefore value) without many of the risks commonly associated with starting up your own practice, before becoming a principal in their own right," said Financial Spectrum general manager Marisa Broome.
Financial planners are guaranteed complete client ownership and can leave the group at any time.
Financial Spectrum strategy manager Brenton Tong said the plan was to afford financial planners an enormous amount of freedom, but conceded that would come with business risk.
"We're expecting that if we provide financial planners with what they need in the start-up phase, through the growth phase and through to the latter phase, that's good business. I don't think you need to lock people in unless you're providing an inferior service," he said. "We're hoping to provide a level of support and coaching and development, so that people will want to hang around."
Financial Spectrum covers the total cost of the start-up, while in return it will take 22 per cent of the planner's gross revenue. Various operating costs, professional indemnity insurance and support staff are also covered, while financial planners receive business coaching and training in strategy, compliance, sales and client management.
"One of the key ways that Financial Spectrum feels that it can provide the greatest level of success to aspiring principals is through supporting them both in financial terms as well as through mentoring support," said Broome.
Financial Spectrum is a fee-based, independently owned financial planning group that has no links to product providers or banks. Broome said she believed it was the first time a boutique firm had established such a program.
"Financial Spectrum is aiming to be known as a breeding ground of successful, professional financial planning practice owners who provide holistic, dare we say 'unbiased' professional advice to their clients," Broome said.