by Susan Edmunds
The Commission for Financial Capability held a workshop on the review of the Financial Advisers Act at its recent summit.
It was attended by industry bodies, adviser groups and Government officials.
Recipients said it was positive the review was not occurring in response to a crisis and would offer a valuable opportunity to take stock of how the Act was working in practice.
But one of the issues identified to be considered as part of the review was the lack of a career path for young people wanting to enter the industry.
Participants said the review should consider the value of apprenticeships or internships for young advisers, or for professional bodies to support their training. They said banks training graduates to become financial advisers was not enough.
Commission for Financial Capability general manager of investor education David Boyle said the question of how to attract young people into the industry was something that needed to be considered.
He said the industry would have to become seen as a profession that offered a viable future.
“When they go to university and they want to be an accountant or lawyer maybe another way is providing a foundation for people to want to see giving advice as being a profession. That’s important because there seem to be fewer and fewer independent advisers around. Looking ahead, the demand for advice is going to increase.”
He said the Act review needed to focus on how New Zealanders could access financial advice.
Other issues expected to arise as part of the review include simplifying the regime for the industry and consumers, commissions, the increasing dominance of banks, the need to lift the financial literacy of New Zealand, the lack of median coverage of personal finance and decumulation questions as a growing number of KiwiSaver members start amassing larger sums of money in their accounts.
Participants of the workshop said consumers often wanted basic information but could not get it because advisers feared being caught by the legislation.
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