Plum Financial Services has launched a financial planning unit within its Momentum suite of services targeting high net worth individuals. Momentum Private Wealth will offer specialised financial advice covering more complex issues of trust structures and tax as well as the holistic financial advice provided for the past four years by about 60 Plum advisers. The private wealth arm will start with 15 “hand-picked” MLC advisers who represent the “crème de la crème”, according to managing director, Mike Fitzsimons.
The new service followed research among members conducted by a third-party research firm in 2007, which showed satisfaction with the existing offering, with the possible exception of a gap in advice for executives and high net worth individuals. All Plum’s advisers operate on a fee-for-service model – either hourly rate or flat fee – or on a basis points charge. Plum is the corporate super administration and education subsidiary of MLC, with $9 billion administered for 82 companies with about 140,000 members.
Speaking at a function for Plum clients in Sydney, the chief executive of MLC, Steve Tucker, told the planners present that they should not be too worried about the Government’s review of superannuation, announced the same week by Minister for Superannuation and Corporate Law, Senator Nick Sherry. “He’s talking about a renovation, not bowling the house over,” Tucker said. It was inevitable that the new Government would give a lot of scrutiny to superannuation and the advice system. “We’ve held the view for some time that we need to move away from commissions and for payments to be more transparent,” Tucker said.
Sherry had held out a carrot to the industry by saying that if advisers and managers got their house in order, there would be a likely increase in the Superannuation Guarantee or other incentives for greater contributions to improve adequacy. Tucker said that Sherry felt that costs were too high but the industry needed to provide him with quality information to make sure there was no confusion around costs.