Advisers name the pros and cons of a career in advice

Speaking on a recent episode of the Financial Planning Association’s (FPA) Future Financial Planner Podcast, host Azaria Bell and Mitchell Harrison, a financial adviser at LBW Business + Wealth Advisors, discussed the best and most challenging parts of being an adviser. 

Mr Harrison said that, for him, the ability to help people tops the list of positives. 

“I think that is something that kind of gets thrown to the wayside a little bit in the way that people think you just work with money,” he said.

“It’s all about people. It’s all about caring. To be a good adviser, you need to care about your clients, and you need to genuinely care and be able to support them and listen and grow. It’s about helping those people and I love that reward.”

Ms Bell agreed, adding that advisers can learn a lot from their clients, particularly those new to the industry. 

“That’s one thing I really loved when I was working in holistic advice is that we similarly had a lot of clients who were pre-retirees or retirees, and there’s so much we can learn from them,” she said.

“As much as we’re educating our clients about their financial situation, there’s so much life experience that we can get from our clients, especially as younger advisers who have yet to go through the things that they’ve been through.

“It’s an incredible, incredible privilege to have those relationships.”

As a risk adviser, Ms Bell said that providing peace of mind to her clients is another huge benefit of the job.

“[Life insurance] is something that’s on almost everyone’s list, but it always gets pushed to the bottom,” she said.

“So, for me, it’s knowing that the client has got that weight off their shoulders, they know that they’ve got that sorted out and they can have the confidence to know that if anything happens to themselves or their family in the future, they’re not going to have to worry about money.

“They’re never going to have to create a GoFundMe to cover medical expenses. They’re never going to have to rely on friends and family to provide them any income.”

On the negative side, Mr Harrison said that the burden of compliance and the constantly changing rules can be particularly challenging.

“It’s a high compliance area and there’s quite a bit that needs to go into it. Any interaction that you have with the client needs to be documented … just so everyone knows what happened and you cover your own bacon if something goes wrong,” he said.

“I think it comes down to change and adapting to change is a really big part of being an adviser because rules change all the time. Legislation changes every year … So staying on top of everything can be a challenge sometimes.”

For Ms Bell, restrictions on how she communicates with friends and family to avoid breaching any advice laws, is a drawback.

“One of the restrictions of being a financial planner is you can’t then go on social media and say ‘Hey, I invest in this or I think this is really good, or this is what I do with my finances’, because you’re seen to be an expert and people will do what you say,” she added.

“If people see what you’re doing as advice no matter how well intentioned it is or whether or not it’s meant to be that way, you do have a responsibility to be really cautious about the things that you’re saying and who you’re saying them to so that people aren’t going to act on that and potentially down the line suffer losses as a result. And that result could get you sued.”

Key motivator for choosing career in advice is helping others

New research published in the Financial Planning Research Journal, a publication produced by the FPA in collaboration with the Griffith Business School, recently revealed that the primary reason for choosing financial planning as a career was an interest in helping others.

Namely, as many as 53.6 per cent of respondents chose “want to help others” as their primary motivation for pursuing financial planning as a study option.

“Contrary to popular media reports, results show that people choose financial planning as a career primarily because they want to help people,” a team of researchers from the School of Business at Western Sydney University, wrote.

Read more here.