Why do advisers leave a firm after their PY?

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.

While there are a number of reasons why a practice would avoid bringing in a PY adviser, whether that be cost or capacity reasons, a common concern raised is the potential of the adviser leaving the firm after they have invested time and assets into their PY.

According to Adviser Ratings’ 2025 Australian Financial Advice Landscape report, these concerns may be well founded.

The report found that advisers who were first registered on the Financial Advisers Register (FAR) prior to 2019 spent an average of 11.4 years with the same practice and 8.5 years with the same licensee. 

Comparatively, those who hit the FAR from 1 January 2019 onward only spend an average of 18 months with a practice or licensee, and 30 per cent have switched at least once in the past six years.

On top of this, a quarter of those registered in the last two years have already switched either licensees or practices at least once.

The report said: “The worrying aspect is that practices will become reluctant to take on professional year (PY) candidates, given the risk they will be lured away to another practice after considerable investment in their development. Practices will need to consider a comprehensive strategy to keep new entrants in their practice to minimise this discrepancy in tenure.”

Looking deeper into why this happens, Simon Gvalda, financial planning recruiter at Kaizen Recruitment, told Money Management that part of the reason he sees advisers leave a firm once they complete their PY is a lack of internal growth opportunities once the PY is complete.

“If another business comes along and says, ‘We’ll pay you more, we’ll give you opportunities to grow,’ there’s potentially a client book, it seems it would be pretty enticing. 

“I imagine if they’re not getting that solid career development pathway from the current firm, of course they’re going to be considering other opportunities.”

On top of this, Gvalda said firms may also struggle with the transition period from PY to financial adviser because the adviser may be qualified but unprepared to work self-sufficiently with their own book of clients yet. 

“You’re not necessarily going to let them loose on all of your clients. You don’t necessarily  want them blowing up any relationships, not because they’re trying to, but just because they are still learning.”

He added: “They probably still need a bit of a hand-holding, to some extent, introductions to clients, and that falls on the senior adviser.”

Then there is the financial factor for businesses to consider as they transition to a financial adviser. This likely comes with the expectation of a salary increase, even though they are likely generating very little revenue for the firm at that stage.

If the business lacks enough clients ready for the new adviser, Gvalda explained, this could inadvertently see the adviser pushed into another role in the firm which could make switching employers that much more appealing.

This is particularly the case if they have to move back down to an associate adviser role after their PY completion as there is not a full-time adviser position or insufficient client numbers to warrant one. 

“That may or may not be of interest to those candidates, and they may look to shift elsewhere if an opportunity comes up.”