One of the more contentious statements stemming from the release this week of the first tranche of the Future of Financial Advice draft legislation was the apparent acceptance by Financial Services Minister, Bill Shorten, that the cost of opt-in will equate to approximately $11 per client.
This observation from Mr Shorten has prompted us to ask how much you believe opt-in will cost the bottom line of your business.
Our question is:
What do you estimate will be the cost per client to include all opt-in processes into your business?
In his statement earlier this week, Mr Shorten noted a report from Rice Warner Actuaries, which it says estimates the cost of opt-in will be approximately $11 per client: “Opt-in won’t create a significant new impost for advisers who are in regular contact with their clients,” Mr Shorten said.
We note the $11 figure is qualified and includes assumptions by Rice Warner about existing regular contact between adviser and client. But Mr Shorten chose to quote this number in the release of the draft legislation. Earlier Treasury estimates put the average opt-in cost at around $100 per client, while others have said it may cost up to $250 per client.
Additional details surrounding the opt-in process have been released (click here for details), in which electronic opt-in renewal processes are available in a range of options the Government says offer significant flexibility.
In an earlier poll we ran on this question, there was overwhelming feedback that opt-in will impose a significant extra cost to the bottom line of the advice practice. Given that additional details have now been released, has your opinion changed? We are asking for your best estimate about the cost of opt-in for your practice…
Not sure at present but can bet bottom dollar will be lots more that that tosser says
So if i send an op in op out statement and the cllient does not send it back, i have to chase the client, and if i can’t trace the client, i don’t really know what they want. My reward for all this hard work is a $50,000 fine. Heck i have many clients. If this scenario occurs for 10 clients, thats a $500,000 fine, because my clients can’t be bothered with something. So i have to assume my client does not want my service if they don’t return the form. Hey most clients hate this type of imposition, and probably won’t return it. Isn’t this the most fair system. This Government are pro small business. When are they going to stop crusifying us for 2 businesses tardy, greedy behaviour.
I’m still hopeful that with all the lobbying all of us are undertaking with the independent Federal MP’s the Opt in provision won’t be passed by the House of Representatives. However if my optimism is wrong then there will be an added cost to all financial planning businesses. The extent of the cost will depend on how clients are contacted, how many times they have to be chased up, etc. I am positive it will be greater than $11 per client. All you have to do is ask other small businesses how much it costs to chase their debtors every month! Most small businesses have an accounts receivable staff member to chase money owed by customers! At a time when we are being forced to cut costs this is going to add to our costs and for absolutely no consumer benefit because from 1 July next year clients can leave at any time not wait 2 years to work out whether they need our ongoing advice and service or not! This government continues to make very bad decisions!
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