Financial planners, especially those new to the industry, are shunning smaller independent practices to instead chase opportunities at larger dealer groups, according to the head of financial services recruitment at Robert Walters.
“A lot of people working in the smaller firms have been interested in looking at the larger firms, as they want the support of a larger organisation and greater progression opportunities they have to offer…with the brand force behind them,” says Pamela McDonald, manager - financial services operations and financial planning, Robert Walters.
She believes that visibility and market recognition are particularly important in the current environment, especially amid the ongoing uncertainty around the Future of Financial Advice (FoFA) reforms.
“Their customers are reliant on strong brand names, they want to know that they’re going to a trusted financial adviser,” McDonald explains, suggesting the same factors have also influenced financial planners.
She suggests that working for the larger brands is regarded as easier, “because [people] know who they are. Customers are generally more comfortable than they might be with the smaller practices”.
However, McDonald highlights that the flipside of this is that the bar has been raised substantially for those seeking to enter the larger bank-led financial planning practices.
“A major thing that’s come out of FoFA is how it’s affecting education levels. Something that’s really changed in the last couple of years, especially for the larger banks, is that they have a very high standard of intake when hiring planners,” McDonald says.
“They have a really rigorous interview process, and part of that is making sure [financial planners] have the relevant qualifications, have been doing their CPD and have been keeping up to date – they’re the major changes we’ve seen.
“There is a much higher expectation in terms of education requirements. A lot of our clients have said to us, ‘look if they don’t have these qualifications, we won’t consider them’”.
In terms of salaries for financial planners, McDonald says there has been an improvement from the relatively stagnant salary market of 2013.
“For senior planners last year…based on a package, they were attracting salaries of between $80,000 and $100,000, these are now in the range of $110,000 and $150,000.”
“More junior financial planning roles were attracting salaries of around $55,000 to $75,000, these are now between $75,000 and $100,000, with para-planning salary trends much the same,” she adds.
I read this article with some disappointment and concern at the innuendo posed that small financial planning business advisers are not at the educational standard of those employed via the larger banks.
We (small business owners) also pride ourselves on strong and relevant education and are very considered when employing new advisers to ensure they have the required education and more importantly the ability to connect with the client. The interview and selection process needs to be very thorough as we do not have the resources nor the funds to continually get this selection wrong.
Also the article implies that brand recognition breads trust, I find this to be a very narrow and at the same time a very generalised comment. I would hope that my valued clients do not base our relationship on the product(s) they are provided with but on the advice we recommend, implement and continually review.
I would also hope that any future employee would have the foresight to base their decision on the environment they are about to enter not just on the size of the company and/or the ease of the work.
What this article required is a balanced view and comparison of big business verses smaller and which style suits each type of employee.
Regards
Sean