TAA calls for proactive action to address consumer demand for advice in next decade

The Advisers Association (TAA) is urging advisers to adopt a more proactive approach and take immediate coordinated action to address the unprecedented consumer demand for advice over the next five to 10 years.

TAA chief executive officer, Neil Macdonald, stated in a group statement that one of the top priorities should be the creation of an “organised recruitment campaign”.

Mr Macdonald specifically highlighted, in light of a recent survey, that a considerable proportion of graduates from certain undergraduate programs remain underemployed during the initial four to six months following their graduation.

“Some of these study areas are closely related to financial advice,” he said, adding that graduates include those that studied accounting, banking and finance, and economics.  

“We therefore have a window of opportunity when people first graduate to encourage them to consider other options and doing what may be just a few additional subjects to follow an advice career.”

As such, Mr Macdonald encouraged the profession to establish a well-organised recruitment campaign to avoid missing the opportunity, making it convenient for graduates to discover and fill vacancies while highlighting the positives of the profession.

Another issue cited by Mr Macdonald as needing to be reversed urgently included stemming the exit of experienced advisers.

“There are highly experienced advisers who have passed the FASEA exam, but are not willing, or not able, to commit to the further education required to continue practising,” Mr Macdonald said.

“Highly experienced advisers should be allowed to continue to practise without having to meet the new education requirements potentially until 2035, subject to certain criteria.”

The criteria TAA proposed includes passing the FASEA exam, having at least 15 years of experience as of 31 December 2021, and passing a competency assessment at AQF7 level or higher.

While the decision regarding the experience pathway lies with the government, Mr Macdonald said advisers can focus on transforming the mindset of their older peers in relation to further education and helping them prepare for it.

“Education providers could, for example, be encouraged to create training specifically for older advisers, in the same way that driver education programs have been created to help those over the age of 75 keep their licences.”

Another key issued needing to be tackled according to Mr Macdonald is the Professional Year which, he said, creates a significant time and money impost on licensees and smaller businesses.

“When you’re a small AFSL, supervising graduates often means you can’t be as productive in your business. You also obviously have to pay them,” he said.

“The flip side is that employing graduates is likely to be more affordable than hiring experienced advisers, and they’re likely to be tech savvy, which could lead to greater business efficiencies.”

Although such decisions are beyond the profession’s control, Mr Macdonald suggested collaborating with educators, technology providers, licensees, and practices to create programs that simplify and standardise the supervision, documentation, and evaluation of Professional Year obligations.

Ultimately, he said, advisers “need to reimagine and redevelop our own future”, rather than relying entirely on governments and lawmakers.

“We need to do it together and we need to do it now.”