Prescriptive PY produces problems
Prescriptive Professional Year (PY) requirements are hampering the advice industry in a time of declining adviser numbers, says two industry associations.
Speaking at the SMSF Association conference in Adelaide, Marisa Broome, Financial Planning Association of Australia (FPA) chair, said the biggest challenge for its 1,000 student members was cracking that first job to become qualified financial planners.
“So we haven't got a problem attracting people into the study because they can see the amazing opportunities about entering into being a professional financial adviser,” she said.
Being the holder of a licensee, Broome said she lacked the time to supervise a new entrant under the current PY arrangements.
“Do I think the PY is a good programme? In principle, I do,” she said.
“It's very prescriptive and I can't manage that so we need to find more opportunities to train them and give them the experience.”
Association of Financial Advisers chief executive, Phil Anderson, said there needed to be more done to retain the good advisers who remained in the industry.
“There are something like 880 who still have the opportunity to pass the exam,” he said.
“So we're going to provide them with as much support as possible and we can't just judge them in terms of whether they should have passed the exam. Some of them are dealing with issues around the mindset and it is not necessarily a reflection of their capability.
“Whilst we want to reduce the numbers that are dropping out, we want to make sure we're getting as many new entrants coming in as possible.”
AUTHOR
Liam Cormican
Recommended for you
A quarter of advisers who commenced on the FAR within the last two years have already switched licensees or practices, adding validity to practice owners’ professional year (PY) concerns.
Integrated wealth and financial services group Rethink has launched a financial planning arm called Rethink Wealth to expand beyond property investing and into holistic wealth management.
While adviser numbers continue to slowly creep back up, the latest Wealth Data analysis reveals they would actually be in the green for the calendar year if it weren’t for so many losses in the limited advice space.
Iress has appointed a chief AI officer to spearhead the fintech’s strategic focus on AI, with chief executive Marcus Price describing how the technology opens the doors to a “new frontier for wealth advice”.
