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Advisers With Degrees Have Met New Standards – AFA

The AFA has downplayed the likelihood of advisers with degree level qualifications having to undertake further extensive study, telling members they have already met the standards required under professional standards legislation.

In a lengthy message to members, aimed at addressing confusion following the release by FASEA of proposed education standards for existing advisers (see: Existing Advisers Will Require Study), the AFA stated that from its perspective “advisers who have already completed a degree, particularly in a relevant discipline, are degree qualified. This is the objective of the legislation”.

The Association added that where a degree was not in financial planning, further education – including continuous professional development, professional designations and formal short courses – has been sufficient in keeping up to date with changes under the Corporations Act.

“It was our view that an adviser with a relevant degree, the DFP and the ADFP or a professional designation such as the FChFP which is at a higher AQF level, should not have need to do any further study, however we are hopeful that the bridging courses will be reasonable,” the AFA stated.

“It was our view that an adviser with a relevant degree…should not have needed to do any further study…”

The message to members also tackled misconceptions that degrees more than 10 years old would no longer be considered relevant, stating this was ‘simply false’ and said the 10 year issue related to the recognition of prior education for credit towards further study.

“This is a fundamentally different to the issue of what education FASEA will recognise. The FASEA announcement provides no indication that they will not recognise degrees that are older than 10 years.  Advisers with older degrees will still be able to get recognition for them, although they are likely to need to do a bridging course of some form,” the Association stated.

According to the AFA, the announcement by FASEA from 14 December 2017 was mainly intended to provide guidance for existing advisers who do not have any tertiary qualifications, and specific details concerning bridging courses and recognition of prior learning have not yet been released.

AFA members were encouraged to review their own education levels and to begin to prepare if necessary with the Association stating “the requirement to increase education standards is law, it is going to happen, so we need to be prepared”.

Members were, however, urged to be cautious with the AFA pointing out that FASEA will still be consulting on education standards until 29 June 2018 and, unless members were required to complete an undergraduate or masters degree, they should wait before commencing any study as no graduate diploma or bridging courses have been approved by FASEA.

  • Nick

    I have been in the industry for 38 yrs and have the following academic record. Bachelor of Economics (1981) LUATC 1 & 2 completed in the 80s, Diploma and Advanced Diploma and now into my 3rd of 8 subject in the Master of Financial Planning. Always something to learn to keep ahead. I am very happy with the course and it is very empowering to be working towards the formal qualification. You just need to get on with it despite the extra hours it takes off your business and family life. It is all worth it as it has brought more business as a consequence of a clearer understanding of every aspect of the financial planning industry. I’m sure if every current adviser had to sit an exam today to prove their knowledge, we would see many fall short. Degree qualification will lift the professional standards and make the consumer more aware that we are not just salesmen.

    • Adam p

      Nick, so for the last 38 years you have not considered yourself a professionally qualified financial adviser ?

  • Jeremy Wright

    What a great idea to let the lunatics run the asylum.

    If you ask a “for profit” education provider, if higher theoretical education is important to the well being of clients of advisers, I think we all know what their answer will be.

    In order to charge hundreds of millions of dollars, you need to convince the Government that years of practical experience advising clients, is not sufficient and degrees are much better.

    The education industry obviously have very good lobbyists and as usual with Australia, we will end up with a worse position for many Australians, due to experienced advisers with impeccable records, deciding to exit the industry rather than face more cost and time, learning subjects that are not relevant to their Business, the obvious one being Risk only adviser practices.

    What is happening in the real world, is there are a flood of university qualified people who are struggling with high University debts against their bits of paper and are still finding it a struggle to get a decent job, as employers prefer experienced people to advise their clients.

    What we have now is a system that will drive out experienced people who don’t have the necessary bit of paper that is heavily promoted by the education industry and
    young inexperienced people full of hope and a large debt, who do not have the real world experience to advise people, with no older experienced advisers to mentor them.

    I just recently got back from New Zealand and a comment I heard about the Australian
    system compared to the NZ system, is that NZ does not have spare, hundreds of
    millions of dollars to spend on long enquiries like our “churn” enquiry.

    What they did do however, was quickly find out who the tiny percentage of churners were and told them further action will be taken unless they ceased.

    Case closed in weeks at virtually no cost.

    Compare that to the fiasco Australia has gone through and come up with, which is a
    solution that was flawed at best, though is more negligent, with a worse outcome for so many innocent people.

    Australia has gone from a go and get things done society, to a highly regulated
    bureaucracy that drives down productivity and sends Business to the brink with
    regulations that forget the basic principle of allowing Business to do Business in a manner that encourages innovation, productivity and profitability, though not to the detriment of the customer.

    We need to look to the NZ model and the fiasco of the UK model that cost Billions and
    learn from them.

  • Adam p

    FASEA & ODwyer have done a conflicted hatchet job on advisers and there is no time to be cautious, this needs immediate and forceful rebuttal.
    Why should i do a bridging course ?
    My education and experience is:
    – B. Economics (Double major in Economics and Business Law) completed 1996 from Macquarie university. [Which seems to my understanding to not be a recognised degree for anything under FASEA / FPEC ?]
    – Full 8 subject Dip FP (before it was Adv Dip FP) completed 2002
    – Grant Abbott SMSF Specialist Adviser Courses Part 1 & 2 at 30 credit points each to become SPAA Accredited Specialist Adviser, completed 2005, that of course now is SMSFA.
    – University Technology Sydney / FPA Estate Planning Specialist course to thus be a recognised Estate Planning Specialist Adviser 2013.
    Plus of course 19 years of the ongoing CPD, etc.
    Authorised Rep adviser since 1998, thus 19 year’s experience.
    Applied to ASIC and started our own AFSL in 2005, thus 13 year’s experience as the Responsible Manager of an AFSL, reporting annually to ASIC and more ongoing CPD

    All up I have spent approximately $50,000 on education and CPD and FASEA say that is absolutely worthless.
    WTF ??????

    • Warren

      Totally agree with you Adam. How about we ask to see the qualifications of the politicians and those sitting on the boards making up all the new rules. I would like to see Kelly O’Dwyers degree to see how relevant it is to her portfolio just as Josh Frydenberg is massively qualified to comment on nuclear issues.

      • Adam p

        Warren, regardless of ODwyers Arts Law degree and Frydenbergs Law Economics degree, their degrees are both older then 10years ago and thus to be fair to us and in FASEAs style rules should be worth absolutely nothing!!