Superannuation and industry funds have seen a massive rise in advice given over the phone in the past year - does it signal a trend towards scaled advice? We speak to Pauline Vamos of ASFA and Simon Swanson of ClearView Wealth for their thoughts on the changing needs of clients.
Video transcript below:
Donna Sawyer, Wealth Professional
Donna Sawyer: Superannuation and industry funds have seen a dramatic rise in the amount of advice given over the phone during the past year. Some say there is a revolution underway as investors seek fast and targeted advice, but Simon Swanson of Clearview Wealth says it’s a big opportunity for financial planners.
Simon Swanson, Clearview Wealth
Simon Swanson: I think it’s an opportunity on scaled advice, not necessarily towards scaled advice. I think what’s actually happening is the market is actually segmenting a lot more. So you are seeing people who are prepared to pay for high quality advice and they will continue to do so and you are seeing actually a new segment in the market in the whole scaled advice story. So I think that is an opportunity, but it’s not just the industry funds, it’s actually an opportunity for advisors too.
Pauline Vamos, ASFA
Pauline Vamos: This has been coming for quite some time and the types of advisory services that have been developed by industry funds in particular has been fantastic. And that’s because they are often starting from a blank sheet. And so we have seen some very innovative ways in which they have started to provide advisory services and they have started off not by having a face to face with the client, how most advice is delivered, but they have started off with an electronic relationship and they built from there.
Donna Sawyer: Pauline Vamos of ASFA says while clients want their advice tailored to their needs, financial advisors who specialise in retirement planning are likely to have a bright future ahead of them.
Pauline Vamos: I am starting to think, we will see a real specialisation in financial planners around retirement planning, which is different to wealth planning and we have got a state planning, but retirement planning – looking at how you balance the equity in your home, the increased costs of age care and health care, what you’ve got in your super and what you’ve got in other assets and how to get the most out of that is a real specialisation and I think the more advisor groups that can start developing that specialisation, they will have a real service that they can offer to superannuation funds.
Simon Swanson: Not just retirement advice, it’s actually aged care advice. At the end of the day, people are living longer, their health is actually staying quite high, however mental health is actually dropping, they need a lot of skilled advice around the right kind of retirement home, how you actually transition from your own place into a retirement home etc. There are so many tax issues in that, there are so many inter-generational issues in that, so I think it’s a huge opportunity in the future, all around aged care.
Donna Sawyer: So why should planners tap into the growing market for scaled advice? Simon Swanson of Clearview Wealth says fostering relationships with younger clients now will pay dividends down the track.
Simon Swanson: At the end of the day, there is a huge number of clients in Australia, who actually have quite small balances, but in due course they will become valuable clients who will then need advice. Smart advisors are those who are going to get hold of those clients today, while they got small balances, start the relationship and over time take them from a scale of light advice solution to a more holistic and sophisticated solution.
Donna Sawyer: This is Donna Sawyer reporting for Wealth Professional.