Brokers better suited to serve financial planners' clients, counters aggregator CEO

by Mackenzie McCarty22 Mar 2013
“When you look at financial planning, there are two levels of financial planning education: There’s RG146, which allows you to sell life, risk and comment on super and then you’ve got the full financial planning diploma which allows you to do estate planning, equities investments, derivatives – I don’t think brokers want to get into that space anyway.”

For a broker to get educated to the correct level, he says, would mean getting their RG146,“and that’s only a year’s education. That’s not much more than what they have to do to get their diploma for mortgage lending.”

Brown says ‘smarter’ brokers are already doing 75-80% of a statement of advice once they’ve completed a loan application anyway.

“The other 25% for a statement of advice is about the client’s risk appetite and also understanding what their current coverages are in terms of life, risk and super and I think most brokers are doing that.”

“In [response] to Max’s comments, I actually think it’s the other way. I think it really should come from brokers into financial planning, because I think [brokers] are better suited and better qualified to take up that role that [financial planners] have been ignoring for the last decade, which is just making sure customers have the right coverage on their assets and liabilities.”

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  • by Dean 22/03/2013 10:32:59 AM

    Here, here.

  • by John Graham 22/03/2013 10:42:32 AM

    Tim you are ill informed or just naive. The simpe truth is a broker is about the transaction. Very few brokers actively "service" their clients. Contact with them is not service by the way. The Financial Planning industry despite the bad apples has for some time provided active advice and strategy AND ongoing service by reviewing their clients progress to goals and objectives. And now with FoFA, true client engagement will be paramount. I agree that it is possible for both industries to cross pollenate but a planner these days is a more highly qualified professional and already has discussions around debt whereas a broker does not traditionally discuss the breadth of advice areas a planner does. So your comments Tim look desperate and defensive.

  • by Brent Kelly 22/03/2013 10:54:11 AM

    I am a financial planner moving into the broker space. The main reason, I am sick of seeing brokers 'over lend' to average mums and dads who can’t afford it.
    my thoughts on those brokers who move into FP space, I am terrified they are taking the FP industry back to the dark days of product flog at any cost- comments by Mr. Brown re 'give clients products they want' convinces me he has no idea what a good financial planner actually does- terrifying comments really. These brokers entering the FP space are there to increase their business revenue at the detriment of the client outcomes. (do they know what a PRS is). For me, as a long term 'fee for service' planner it is scary stuff and I would encourage ASIC to 'fire a shot across the bow' of these broker FP dealer groups before it’s too late.