ReadersofMoney Managementwill have seen stories about financial planning dealer groups that have talked up their future growth plans. These are usually based on the growth of adviser numbers in the group.
But the underlying question in each of these cases is where will the planners come from?
It is an oft-repeated statement that the financial advice profession and funds management market are the smallest they will ever be. With the increasing levels of consumer awareness and investable wealth this will be proven to be true, but will there really be hundreds of extra planners available to provide advice.
When questioned as to where they will find new planners, most dealer groups reply that they are poaching them from other dealer groups or from the banks.
While the banks are seen as a training ground for other dealer groups, they’re not fools. Once they fully understand the nature of providing a full range of financial services, they will stem the flood and keep their planners.
This will not change the number of planners working in the industry though and with the implementation of PS 146, the road to becoming, and staying, a finanical planner has gotten a little harder and longer. At present, the minimum standard is a tertiary degree for new entrants, so the smallest time frame is still three to four years to get a fully trained technically proficient planner. The time frame to get one with experience and client empathy is even longer.
Why would good planners want to leave an environment where they are supported and able to get on with the business of providing advice and service to clients? It is highly likely then that those planners who are freely available are either unhappy in their present place or just not very good at what they do. Is that the type of planner you want in your business? Maybe not, but even these planners might be hard to find, as dealer groups compete for the limited number of advisers out there.
Yet, should the focus on providing advice shift from planners to other staff? Is having hundreds of planners on-board the solution? What about improved back-office systems which allow planners to do their job, while others do the important, behind the scenes legwork?
Are you going to a team made up of whoever the group can find or is the push for quality there? Keep this in mind next time a planning group knocks on the office door seeking you out as one of its new recruits.
