Time to promote advice: Dodds

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More needs to be done to promote the use of financial advisers, the chief executive of the Institute of Financial Advisers says.

Friday, November 28th 2014, 6:00AM 3 Comments

by Susan Edmunds

Fred Dodds said his organisation had been visited by the Ministry of Business, Innovation and Employment in preparation for next year’s review of the Financial Advisers Act.

He said they were interested in things such as investor confidence, the complexity of regulation, the quality of advice and consumers’ access to advice, and wanted to eventually canvass the public as well as industry opinion.

But Dodds said one of the issues for the sector was a lack of promotion of personalised financial advice. “If you don’t promote it, it’s not going to happen.”

He called for sector players to work together to make it happen, including the FMA and Sorted.

“Even if you go to Sorted and read this and that, there’s no link to ‘want to find an adviser?'”

Dodds said it would be beneficial to have some serious work done promoting financial advisers.  While public surveys might elicit some positive comments, most people ranked advisers low on the trust scale.

The industry should seek and publicise the views of clients of some of the country’s best advisers, he said. “You might have them saying I’ve used [Bruce] Cortesi for years and he’s very helpful and has taken the potholes out of my financial planning road. We need to have those comments coming through to reinforce the fact that advisers are not ripoff artists. David Ross was an accountant, John Milne was a lawyer, there are no Robert Oddys or Murray Weatherstons charging around, flogging people’s money.”

David Boyle, of the Commission for Financial Literacy and Retirement Income, which operates sorted, said it promoted the view that consumers should get financial advice. But he said advisers needed to make it clear what the value of their advice was.

“It’s quite a complex issue, and I have significant concerns that as more people get more money [in KiwiSaver], you’d hope they need advice. Many advisers don’t want to work with such small balances. It’s a bit of chicken and egg.”

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