Industry participants who are too busy touting doom and gloom in the face of upcoming regulatory changes risk missing a big opportunity, AMP’s director of financial planning, advice and services said.
“I am sick of hearing all the time of people predicting the end of the advisory and financial planning world,” Steve Helmich told a gathering earlier this week.
Australia’s 16,000 financial planners are preparing for the start of the government’s planned Future of Financial Advice (FOFA) reforms but chronic delays have added to uncertainty dogging the industry.
Helmich said it was absolutely correct for industry participants to act to influence the outcome of the changes but believing the changes would destroy the industry was misguided.
“People who predict the demise don’t really understand what planners do,” he said.
Regulatory changes have been part of the financial landscape for decades, Helmich, who joined AMP in 1973, said.
The changes have nearly always sparked gloomy predictions which have, so far proved false, he said.
“Go back to the 70s. At that stage, a tax deduction was in place for life insurance [but] it was removed. It was all over then,” he said, referring to industry sentiment.
“There were no roles for advisers. They were finished. Done.”
In 1983, a tax was introduced on lump-sum superannuation contributions.
“We had AMP advisers ringing up our technical people, saying: ‘That’s it. No one will ever put money into superannuation again.'”
However, financial advice is inextricably linked with the big life events of all Australians.
“The fact is, while people retire, while they get married, while they have babies, while they take on debt, while they have goals to achieve, there’ll be a need for great advice and there’ll be a need for professionals to provide that advice and guide people through the maze,” he said.
“The simple issue for planners in the current environment is if you have deep value-added relationships with your clients, even in light of any changes that are coming, your future is very secure. Possibly, it could be even more secure and more prosperous.”
He cautioned against clinging to ‘the old days’.
“This is not the thinking that can get us recognised as a profession. In fact, it can make people think we’re out of touch.”
