Caitriona Wortley believes the advice industry is trending towards specialisation, with areas like retirement and aged care increasingly needing specific and authoritative expertise, but she warns that the issue “isn’t black and white”, and advice specialisation shouldn’t be at the expense of traditional advice provision.
Wortley, the head of distribution at Allianz Retire+, says after speaking to advisers in the industry about the matter it’s apparent that specialisation only works up to a certain point. Wortley will moderate a panel discussion on the topic at this year’s Best Practice Forum.
“If you asked me about this 12-months ago I would have definitely said yes, but I having explored it a little further it’s not the same,” she says.
Outside of the cities, Wortley explains, there isn’t enough business for specialists to thrive and the traditional role of an adviser is valuable. She recalls speaking to an advice principal with “a lot of regional officers”, who said they couldn’t approach advice specialisation in the same way as firms in the city.
“If you’re looking at mass Australia, and giving advice to mass Australians, the specialisation just won’t be economical in those [regional] areas,” Wortley explains.
She says the adviser used a medical industry analogy, telling her: “You’ve got to be a GP, rather than a medical specialist, if you’re servicing regional Australia.”
She also makes the point that, in respect to retirement advice, the advice relationship often benefits from a longer, broader relationship encompassing all aspects of a client’s financial life, which a specialist retirement adviser who meets the client later in life may not experience. “If you want the best outcomes for your clients, not just financially but emotionally, you have to be with them early in the journey,” she says.
So, while there is clearly a need for advisers to start evolving into specific areas such as retirement planning there are also benefits for clients in having an adviser that straddles both accumulation and decumulation phases.
Specialisation is coming, she says, agreeing with Financial Planning Association CEO Dante De Gori, who commented at the Professional Planner Best Practice Forum last year that it was “inevitable”. However, the trend won’t be an absolute one and the traditional advice role will continue to be valued, especially in regional areas.
“I do see us going that way,” Wortley says. “I mean, you do come across some aged care specialists and things like that, but I think we’re quite a long way from that.”
Joining Wortley on the Best Practice Forum’s panel will be a mix of advisers and industry specialists, including Veridian Advisory executive director Todd Clifford (Melbourne) and managing director of Advice Wise, Matthew Fenning (Sydney). Register now for the event if you haven’t already.