Holistic advice growth stalls, but accounting model sees gains in 2024

Between January 1 and September 19, 2024, the number of financial advisers operating under the holistic advice model remained unchanged. The total continues to hold steady at 10,412 advisers, the same as at the start of the year.

While zero growth for the year to date may appear negative, it compares positively to a decrease of 0.8 per cent in the same period in 2023.

Turning to the accounting model, it presents a story of two contrasting trends. On the positive side, the accounting–financial planning model, largely made up of accounting firms offering holistic advice, experienced the strongest growth in 2024 YTD, increasing by 1.5 percent - this translates to a gain of 13 advisers, bringing the total to 898.

However, the accounting – limited advice model, which offers mostly restricted advice for self-managed super fund (SMSF) clients, saw the highest loss for this YTD at 12.4 per cent or down by 71 to 501 advisers. This is more than double a decline of 4.9 per cent in 2023.

Merit Wealth exemplifies this model, offering restricted SMSF advice. When asked about the adviser turnover following the acquisition of Diverger, which included Merit Wealth, in March, Count CEO Hugh Humphrey addressed the issue.

Humphrey said: “When we announced the acquisition, I said 550 financial advisers would be the combined ARs at completion and that’s because the limited ARs on our books, largely within Merit Wealth, are a different type of authorisation who may only give advice once or twice a year or do a piece of work for a client around a self-managed superannuation fund. That’s very different to an adviser who has 150–200 ongoing financial advice clients and very different in their revenue.”

Looking at the superannuation fund-based advice model, generally composed of industry super funds delivering advice, this group recorded a 6.3 per cent decline or fell by 45 advisers to 669 in total.

“This decline is largely due to mergers among super funds and advisers previously limited to basic superannuation advice being removed from the ASIC Financial Adviser Register (FAR),” said Wealth Data founder Colin Williams.

The super fund model experienced a slightly smaller decline of 5.3 per cent in the first nine months of 2023.

Meanwhile, the investment advice model recorded a minor drop of 0.8 per cent or down by 22 advisers to 2,905 during this calendar YTD, compared to zero change in the previous year.

Source: Wealth Data

Weekly movements

In the week ending 19 September 2024, the advice profession saw a net growth of five advisers. This was despite another solid week of 16 new entrants, indicating that some 11 experienced advisers dropped off the FAR this week, Williams said.

Some 31 licensee owners had net gains of 36 advisers in total. Four AFSLs were up by two advisers each – Perpetual, Centrepoint Alliance, Ord Minnett, and Sherrin Partners, while 26 licensees gained one adviser each.

Looking at the adviser declines over the week, 27 licensee owners had net losses of 32 advisers in total. Five licensees bid farewell to two advisers each, including Count, while 22 AFSLs lost one adviser each.