Platform verdict – advisers want value, not fees

Functionality and service have overtaken fees as advisers’ key concerns when using wraps and master trusts, according to a new study, which also revealed a perception that platforms were responding too slowly to changing needs.

The study involving 715 financial planners, paraplanners and risk advisers, showed more than 70 per cent considered functionality important or very important, and almost 65 per cent said service was vital in their platform. More than 47 per cent of advisers were indifferent on the importance of fees.

Australian Finance Group Financial Planning dealer principal Ross Nayler said planners’ attitudes toward platforms were linked to their perceptions of value.

“They’re interested in what they can do for the client and how effectively and efficiently they can do that, and service and functionality are both important. But I think it’s a case of assessing on value for money rather than just costs alone,” he said.

Zurich Financial Services Australia’s head of corporate superannuation and wrap Karen Malzard said platform fees had fallen recently.

“They’re at quite a reasonable level now, so I think that’s why fees have become less of a consideration,” she said.

The research, conducted by Brandmanagement, also found some of the planners and dealer group heads interviewed thought platforms were not evolving quickly enough.

One dealer group head interviewed by the researchers commented: “The best platforms will be those that are half a step ahead of where advisers and their clients are moving. I don’t think this is happening at the moment though, as it’s very reactionary.”