Advisers who provide limited advice, including life insurance advisers, should not be required to undertake the same level of training as full service or holistic advisers according to the head of financial services training provider.
Mentor Education, Principal, Dr Mark Sinclair said proposals to lift education, currently in draft legislation before Federal parliament, were long overdue but they should not create new hurdles for advisers who will only ever provide limited advice.
“It makes no sense for those who provide limited advice, such as life insurance advisers, accountants providing superannuation advice, those who provide broking services, to do a full 24 unit bachelor level course,” Sinclair said.
“It makes no sense for those who provide limited advice, such as life insurance advisers…to do a full 24 unit bachelor level course”
“If advisers are going to provide limited advice then they should be trained in the relevant core subjects to that advice, in the area of ethics and in the area of business and markets so they can understand the sector they have chosen to specialise in. Why make an adviser do a course for an area of unrelated advice?,” he said.
Sinclair also stated adviser association post-nominal qualifications should not be considered as ‘degree equivalents’ and calling them such would leave the advice industry open to ridicule stating, “If we play games with qualifications we just give ammunition to our critics at a time when a holistic adviser should be holding an actual degree”.
However, Sinclair said the four credits of the post nominal course together with the eight subjects in an Advanced Diploma course could be used as credits or exemptions towards a 24 subject Bachelor’s degree.
He also stated that while related qualifications – such as commerce or economics – may be used to enter the financial advice profession, under the new legislation advisers with these qualifications should be restricted to limited advice until they have attained a Bachelor of Financial Planning, with 24 relevant financial planning subjects.
“Of the 41 courses offered as pathways into financial advice none are offered as a distinct Bachelor of Financial Planning. They tend to be commerce or economics degrees with financial advice units added, which makes the financial advice training no different than a Diploma or Advanced Diploma,” Sinclair said.
“While acknowledging there is angst amongst some sections, the reality is the financial advice industry simply cannot progress further, and take its place alongside trusted advisers such as accountants, lawyers, doctors, teachers, etc., without appropriate and benchmarked higher education academic qualifications,”
He said any new education requirements “…should be contemporary and appropriate to both existing advisers and new industry entrants” with a three year transition period to allow existing advisers, many who would already have around half of the necessary training, sufficient time to meet the higher benchmark.