Judging from recent publicity and a sampling of the positions vacant columns, demand and rewards for financial planners and associated support staff is growing strongly. Recruitment expert Anne Hatton offers a rundown on the employment prospects for young people considering a career in financial advice.
Increased competition and regulation and greater awareness amongst consumers are the key factors contributing to the increased demands now being placed on financial planners.
As a result, we are beginning to see a change in the role of the traditional financial planner and therefore the type of people who are suitable for and are attracted to the profession.
There is a growing trend towards planners offering both “fee for service” and complete financial solutions for customers. This trend has consequently increased the demand for financial planners whose professional strengths are confidence, intelligence and strong relationship-building skills.
In addition, an increasing range of retail and wholesale investment products has also increased the complexity of compliance, administration and technical issues associated with it. This new environment is putting more pressure on financial planners to be constantly updating their qualifications and technical expertise.
Dealer groups are also moving through a period of change, and this is having an added impact on the role of planners and the challenges they face.
While the dealer groups themselves are consolidating, we are also seeing the emergence of decentralised financial planning networks. These are often supported by centralised para-planners, technical administration and support functions.
There is also increasing pressure being placed on the dealer groups to add value to the planners, above and beyond what they have provided in the past.
But not all organisations are targeting the same customers or providing the same level of service. Some of our major banks, which are in the process of becoming more like financial service organisations themselves, have introduced a tiered concept for providing different levels of service to suit different customer groups.
The directions these institutions are taking can provide more opportunities for prospective planners seeking an “entree” to the financial planning profession. This is because the depth of knowledge and technical expertise required in some bank-based roles is often not as great as it is in smaller organisations.
For anyone considering a long-term career in financial planning, we recommend they take the following steps:
Commit yourself to gaining the essential qualifications and regularly updating them. Completing a Diploma of Financial Planning should be considered the absolute minimum.
Develop your underlying technical skills first. Starting out as a para-planner, for example, provides an excellent platform from which to build a future career in planning.
Identify a good mentor in the business or wider industry and stay in regular contact with them. A good mentor should have excellent technical skills and knowledge as well as strong relationship-management skills, confidence and a passion for the industry.
Shop around for the organisation that will suit you best. Consider the culture and values of the organisation and the people within it to help determine what suits you. It is important to remember that while the financial planner builds the relationship with the customer and provides ongoing advice and service, it can be difficult and frustrating if your employer can’t provide the level of technical and administrative support you require.
Remuneration is an important point and needs to be thought out in advance, as there are a broad range of packages on offer depending on the group. Typically, the higher the base salary, the less at-risk component, plus there will usually be a limitation on the upside earnings potential.
At present, we are seeing strong demand in the financial advisory sector for experienced financial planners, para-planners, research, technical and compliance experts. However, the quality of candidates still tends to be patchy, though it is certainly improving. Clients are also prepared to consider slightly left-field candidates for various positions.
All in all, financial planning is an exciting growth industry offering plenty of opportunities to those who are genuinely interested.
<I>Anne Hatton is the divisional manager of financial services with recruitment company Morgan & Banks Ltd.
