- Yes (74%)
- No (22%)
- Not sure (5%)
Our latest poll results suggest there is significant adviser support for the notion that the term ‘financial advice’ should be classified for consumers as either ‘aligned’ or ‘non-aligned’.
As we go to print, 76% of advisers taking part in the poll agree that the aligned/non-aligned distinction should be made to consumers who receive financial advice. 18% disagree, while a few advisers are unsure.
As we said last week, this poll is based on a suggestion made by Connect Financial Advice’s Paul Tynan that the aligned/non-aligned distinction should be made to clients in the interests of offering greater transparency for the end-user and assisting them to appreciate the nature and scope of the financial advice being provided (see Consumers Taking Back Seat to Self Interest).
“Whether it be placed through an aligned or non-aligned provider is not of consequence. Ultimately it is not the product, it is the advice and strategies provided!”
Some adviser comments suggested the big financial institutions would not allow this kind of classification to occur. But, according to Mr Tynan’s definitions of aligned/non-aligned, the difference between the two terms mostly relates to the ‘transferability’ of the client book should the adviser move dealers. Under this definition, any self-employed adviser, regardless of who owns their licensee, would be considered non-aligned as long as their clients could move with them if and when they change dealers.
Then again, we heard from other advisers who suggested this classification would make no difference to the client. Referring to the selection of a particular platform or investment, one adviser remarked:
“Whether it be placed through an aligned or non-aligned provider is not of consequence. Ultimately it is not the product, it is the advice and strategies provided!”
Our poll remains open for another week if you wish to add your voice to this debate…
aligned/non-aligned I’ve seen what some bank employees do to customers and it is not in the best interest of the client.
In my view, independent doesn’t always equate to being the best. Aligned advisers can be very customer-centric and offer advice based on what their alignment allows. Usually that’s enough because many independent advisers still only use a few product-providers as the solution to the client’s needs – if they need a product of course.
That said, some aligned dealer groups, esp banks, strongly encourage the use of their products almost solely. That’s when their advisers lose their independence and their customer focus. It’s forced on them.
In the end non-aligned advisers can better serve in that capacity than aligned ones. It should be classified.
In my eyes any one directly or in directly affiiated with a product manufacturer is not independant.
The APL applied to all dealer groups owned by product manufacturers is a classic example of a narrow approach.
Research not owned by any product manufacturer and knowledge of adviser is the best way of establishing the best product.
We now live in a global society, yet dealer groups put cuffs on their advisers.
Comments are closed.