Bringing confidence back to brokers

by Keith Cullen15 Dec 2020

Brokers feel under siege due to ongoing rule changes and the increasing cost burden on clients, but Wealth Today managing director Keith Cullen wants to help them get their mojo back by extending the services they offer.

The last few years in retail financial services have been unprecedented. Just as one existential threat passed us by, along came another. Over the past year, as we have expanded our dealer group, I’ve had the opportunity to talk directly to hundreds of advisers and brokers.

Many are mentally and physically exhausted – many are outright depressed. The turmoil of the last decade, culminating in the royal commission and institutional upheaval, has left them so.

Many believe that those who they trusted to serve and support them have done the exact opposite, instead abandoning them. Compliance has been weaponised. Providing quality financial solutions and advice that is profitable and enjoyable to deliver has become seemingly impossible. Rules have been changed and changed again. Interpreted one way by one person and another by the next.

Mortgage brokers have been especially hard-hit over the last couple of years. In fact, their very existence was put in doubt by Kenneth Hayne. Thankfully, common sense prevailed.

What is often forgotten in all of this is that at the centre of what we all do every day is a client who simply wants a cost-effective relationship with someone they trust.

An unfortunate consequence of the last decade of regulation creep is that conventional broking and financial advice services have become too expensive for the average Australian. Insurance advice assistance is a real case in point.

Mortgage brokerage clients will often want to talk about insurance as they take on new debts, and they are keen to do so with someone with whom they have already built a trusting relationship.

James Buchanan (Mortgage Point) put it best when he said to us: “Most of my clients don’t want to pay a financial adviser, or me for that matter, $2,500 or more for an 80-page document to put in place the insurance they have decided they want when they have taken on a new loan.”

Many brokers like James, who get involved in the insurance space, prefer not to refer the work out as they feel they lose control of the relationship and potentially the quality of the outcome. There’s also the obvious commercial benefit if they can do the work themselves.

Having joined Wealth Today under our tailored insurance-only general advice program, James now has no need to take the referral risk and says: “Being able to help my lending clients on a general advice basis for their insurance needs has been immensely valuable to them and professionally satisfying for me.”

At the centre of what we all do every day is a client who wants a cost-effective relationship with someone they trust

Nick Harper (Keylend), one of the first to join our program, says: “Being able to offer my clients more than just a lending service has been a very important part of my business. It’s a natural conversation that many clients want to have.”

While our general advice program has been able to simplify what had become an overly complex process for many clients and their brokers, many brokers prefer the integrated approach and want to extend their services to full financial advice.

Unfortunately, many have seen a cultural shift within their licensees over the past decade, whereby compliance has gone mad, with lawyers and compliance personnel developing impractical, ineffective tick-a-box programs that add little or nothing in terms of commercial outcomes for advisers or advice outcomes for their clients.

The result has been the emergence of an adversarial relationship between licensees and their advisers, one in which malice and even contempt exists on both sides.

This is the current paradigm. It’s the paradigm that drives us at Wealth Today to help advisers get their mojo back. To show advisers that advice can be enjoyable, practical and compliant. To show brokers who are beginning to think personal advice is all too hard that their endeavours can result in great advice outcomes for their clients and great business and financial outcomes for them at the same time.

I pose this question. What is the difference between:

  • an annual practice audit and a practice peer review?
  • an advice ‘pre-vet’ and an advice ‘peer review’?
  • a compliance officer and an advice coach?

To us it’s the same as the difference between stopping poor-quality advice and enabling quality advice.

The difference: attitude. The difference is the paradigm from which we all approach our roles and develop and manage our systems and processes. The difference will be how we feel about what we do every day and the outcomes we achieve for clients and ourselves.

Whether it’s with your aggregator or your AFSL dealer group, the relationship should never be one of criticism, embarrassment, enforcement, suppression, impediment, angst, problems, or a relationship to avoid. Like any business relationship it must absolutely be one of collegiate spirit, enablement, encouragement, learning, pragmatism and opportunity.

Keith Cullen, Managing director, Wealth TodayKeith Cullen
Managing director,
Wealth Today