moneyblog

Advicemonster - We need your input

It was great to see more than 500 advisers in our recent roadshow to launch Advicemonster. We know that we are near the beginning of this journey and we have many suggestions for enhancements to the needs analysis and statement of advice documents. Added to that, with more information on the structure of the new regulatory environment and some great feedback from advisers groups we are looking to launch some key enhancements to the service which will be released in October. Then we have some further development decisions to be made. We need your help. To help us decide what features to add after the October update we would be very grateful if you can complete the survey. It can be anonymous (so you can be mean if you want) or you can include your details (so we can talk with you about your cool ideas). So please take a look at the survey 

Do you run a Dealer Group or an Advice Firm?

The FSC is hosting a dealer group lunch - VIP session in conjunction with Chatswood Consulting. It is going to be held on Thursday the 6th of September from 12.30pm - 1.15pm.

Click here to register.

Australia: Laws Alone Will Not Prevent Bad Advice

An outcome - like avoiding accidents - tends to arise from a number of activities or strategies working in concert. Good legislation is usually one of them, but only one. When we come to rely too heavily on only one strategy, we can get poor results. 

While I am, broadly, supportive of the idea of the Royal Commission into misconduct in the financial services sector in Australia, I don't think this article is the best example of why that inquiry is needed. I offer it to you, instead, as an example of the types of problem that will remain after the inquiry, and after any law change. Max Newnham rightly points out the poor advice given to this client. But the advice was the product of either carelessness or greed, which will remain whether or not the adviser is employed in a vertically integrated advice business. I happen to prefer the idea that consumers have choice. But even if they do, it would not prevent bad advice borne of either incompetence or greed - which can happily co-exist with a long approved provider list. Specifically, the duplication of the income protection cover in the example in the article would be no less possible, and probably no less likely, should the client have been talking to an independent adviser. 

 

Latest Goodreturns piece

My latest piece on goodreturns is here, which is the follow-up post to the one a fortnight ago,about advisers thinking about their plans. Plus there is this piece written by Susan Edmunds based on some informal comments I made about the need for a change in the law. Of course, only some advisers lack client files and good processed - not all.  The comments quoted in that article are clearly not the whole substance of the matter, but the issue around record-keeping and the application of the Code to everyone who gives financial advice are both essential ingredients for a new regime. 

Sorted: Live KiwiSaver Q&A

On Tuesday the 19th of September Sorted.org are hosting a live KiwiSaver Q&A session. More details can be found at this link.

Financial Advice New Zealand Progress

The three large financial advice groups set to build a new advice association are progressing towards foundation with the passage of a crucial member vote. Link. 

Get a better insurance report - put your compliance documents on Quotemonster

You can now have the Quotemonster report customised to your business to include your compliance documents, and make the report fit the order and structure of the advice process you have agreed with your compliance professional. In conjunction with Barry Read, of IDS, Quotemonster has commenced tests with groups of advisers with customised reports. Now is the time to re-work your advice process, and to make sure it happens for every client, the best thing to do is build it into the reports we prepare for you. That way, every client will have the right documents, unique to them, and now, unique to you. 

Newpark and IDS Comments on Draft Financial Advice Law

Newpark and IDS have a good newsletter to their advisers on the draft changes to the law, including a proposal for licensing 'product distributors' and labeling 'Financial Advice Representatives' as 'Financial Product Distributors'. Well worth a read. Link. 

Newpark National Business Coach

Newpark Group have appointed Kim White as their National Business Coach. Read more about Kim at this link.

BNZ Home Loans - A Case Study in the Value of the Adviser Channel

It is interesting to see how BNZ has re-entered the financial adviser market for the distribution of home loans and how quickly it now accounts for 40% of the home loans they issue. That has reversed the gradual slide in BNZ market share. It is also contributing evidence to conjectures on the strength of the advised channel:

• Advisers are able to handle complexity quite well, which helps consumers worried by increasingly complex rules in the home loan area. Those rules keep changing too, as the Reserve Bank struggles with ways to rein in a hot residential property market while keeping interest rates low. 
  
  
• Third-party advisers represent a quick way to reach a lot of customers. While they can be expensive in a variable cost basis they are cheap in a capital cost basis. The added distribution must add up to the equivalent of a lot of branches that would have had to be equipped and staffed before a single loan could be sold. 

Of course, regular readers will know that we don't see this as advisers versus direct. Increasing complexity and the attractions of variable cost channels are forces unlikely to change, so the adviser channel is likely to remain important. We see this as a necessarily multi-channel world. Keep the branches, keep your online sites, develop more, and keep distributing through advisers too, because quite a lot of consumers like advice.