As financial planners and mortgage brokers eye off each other’s territory, one financial services group which has tried a number of different integration formulas, has found there is a workable solution.
According to Trigon Financial founder, Alan Rich, a successful formula needs to account for many aspects, including advisers’ qualifications, people’s motivations, clients’ interests and the ingredients for maintaining a sustainable longer-term solution that suits everyone.
In his experience - which has spanned straight referrals, no fees, DIY, commission sharing, cross-hiring and mergers - only joint ventures that work in everyone’s best interests, including clients, have proven to be lasting.
Rich tells Australian Broker there are a number of issues that cause some integration techniques to fail, but says a key one involves planners taking over the broker role – only to put it aside when the planning side of the business gets heavy.
“What I’ve seen is that the financial planner thinks it’s a good idea to take on broking, but when their financial planning side of the practice gets busy, then the broking side softens - then they start to question if they should do it at all. They’ve done the broking to diversify, but when push comes to shove they go back to the thing they like.”
Another issue is one of communication, says Rich.