Industry disruptors such as technology present planners with a choice, Financial Planning Association chair Neil Kendall says. They can either hunker down defensively and protect themselves from the perceived threat, or they can invite change, look for the opportunities in it, and embrace the future.
Kendall says the 2017 Professionals Congress program is infused with the concept of embracing the future.
“There’s obviously going to be a discussion about fintech, but not ‘Here it comes, let’s talk about disruption’. It’s ‘Here it comes, let’s look at the opportunities,’ ” Kendall says. “Let’s not be like taxi drivers. The horse-and-carriage drivers are out of business; the taxi drivers are staring it in the face. And let’s not be looking for government protections. Let’s accept the future, work out how to make it work better for us, rather than trying to fight it.”
Kendall says there are clear opportunities for advisers to use fintech to deliver better advice to clients. That’s a very different mindset to seeing it as an enemy and looking for ways to shut it out.
“It should be about ‘How do I bring this into my practice? How do I streamline my practice? What can I do better using Fintech in my practice?’ ” he says. “It presents more opportunities for financial planners than threats. Even the most simple technology, like appointment-booking software. Appointment-booking adds zero to the value proposition of a financial planner. But automating that instead of paying a human to do it is an enormous cost-saving for a practice. And consumers are already warming to it. So that’s simple, non-threatening non-advice-based fintech that planning practices could be embracing today.”
Kendall says the congress will also highlight financial planners’ responsibilities and provide a reminder that planners are professionals, with a professional obligation to act in the best interests of their clients.
“The best-interests duty is relatively new, and not everyone is across what it means, how to put it into practice, and how to make sure what you’re doing in your practice meets that,” Kendall says. “We want people to be upskilled around the best-interests duty, giving better advice and some of the ethical dilemmas they’re going to be faced with.”
New and higher education, professional and ethical standards also present enormous opportunities for the nascent profession, Kendall says. Among the changes, all new entrants to the industry from January 1, 2019, will need to have an approved degree; and from January 1, 2024, any non-degree-qualified existing planners will need to upgrade to a degree or degree-equivalent qualification (along a pathway yet to be determined).
“Bear in mind that for most of our members, a degree qualification has been mandatory for quite a long period of time,” Kendall says. He says Certified Financial Planners have been required to hold a degree “for quite a period”; and more recently, Associate Financial Planner status has also required a degree qualification.
“This is not new for FPA members; this is just making sure we bring the tail with us,” Kendall says. “This is saying if you want to be a financial planner, there’s a minimum standard that clients have a right to expect.”
He says it is “a real good-news story, to say everyone is going to be at an appropriate minimum standard to give advice to consumers”.
Kendall says that if delegates “come away with a couple of key messages” by the time the congress wraps up on Friday afternoon, “we will have got a great outcome”.
“Am I sure I’m meeting my best-interests duty with clients, and would someone else looking at my work, agree with me? And am I embracing fintech and getting all the advantages that fintech brings in my practice? What can I change in my practice in the next six months to improve it, using fintech?”
The 2017 Professionals Congress sold out six weeks ago, with delegate numbers topping 1000.
“Our biggest challenge will be handling the logistics of a completely sold-out venue,” Kendall says. “You can’t leave the seat next to you vacant. Every single seat has been sold.”
Kendall says that every year the event attracts greater numbers, vindicating the FPA’s decision in 2013 to reboot its traditional industry conference along professional congress lines.
“People who’ve come once tend to come again,” Kendall says. “Once they realise the value, they think to themselves ‘this was a good investment’ and come again.”