Choice’s view that the quality of financial planning in Australia is “among the worst” is not the fault of the adviser but the industry as a whole, according to Omniwealth.
The financial planning and wealth creation group has hit back at comments made last week in the Australian Financial Review by Choice chief executive Nick Stace, who accused brokers and financial advisers of giving consumers “crap financial advice”.
“While Nick Stace’s comments regarding the shortcomings around the level of advice provided in Australia do have some merit, it would be foolish for Choice to believe they will be able to provide a service which will far supersede the industry, as it’s the industry and its structure that’s actually the problem,” said Omniwealth chief executive and director Aaron Greaves.
“The industry has your run-of-the-mill financial planner who typically works for a larger institution, is vanilla in their offering, and offers a basic service.
“Then there are the true financial planners who pride themselves on advising on all their clients’ financial needs from mortgages, super, insurances and property recommendations,” he said.
Greaves said the industry is still far from effective because it is controlled by a few large organisations, resulting in a “single asset structure” being recommended to clients as a whole.
Greaves believes the Future of Financial Advice reforms are forcing advisers to show their clients the value of their advice, and this will help to change the industry’s current situation.
“Today’s average financial planner is little more than a glorified managed fund salesman,” Greaves said.
“There is a complete disconnect between what your average financial planner can recommend and what their clients expect them to recommend,” he said.
Choice needs to look deeper into the industry if they want to improve it, and compare advisers who are working to do the best for their clients in an industry increasingly controlled by banks, said Greaves.
