Fred Dodds
by Susan Edmunds
Fred Dodds
Improving consumer understanding of financial advice is among the primary objectives of Financial Advice New Zealand, the new professional association that is currently in development stages.
IFA chief executive Fred Dodds said something needed to be done to get the message to the public that an adviser would offer value. “It is that basic question ‘who are advisers and what do they do?’”
He said it was an exciting time to be a financial adviser because financial issues had come to the fore for many New Zealand through things such as KiwiSaver. “But the public generally don’t know if they need an adviser, they don’t know how to find one and they don’t know how to evaluate one. And also don’t understand the value of making better financial decisions,” he said.
“The public just doesn’t seem to have time to understand the types of services advisers provide.”
He said there would be thousands of clients who could attest the value of advice – and there needed to be surveys done that highlighted their experience.
“Advisers, for sure, are educating their clients and their referral sources but a bigger campaign is necessary for the adviser profession, product providers and Government to work together to provide more clarity around ‘financial advice’. Educating the public at large is especially challenging.”
PAA chief executive Rod Severn said it was the responsibility of advisers themselves, as well as professional bodies. “They are the best-kept secret of the lot. They know first-hand the benefits they offer but they don’t talk about it often enough.”
David Boyle, investor education group manager at the Commission for Financial Capability, said it was timely to inform New Zealanders about the value of advice with the Financial Advisers Act under way.
“The three key questions I have been getting at the Commission and on my radio show regarding advice are: Where do I go to find an adviser, what can I expect to pay and how do I know it is good advice for me personally?
“As you know the Commission is a very strong advocate for getting advice and the key going forward is not only highlighting the value of it but what advice might look like in the future. How can it be made more accessible to more New Zealanders when they need it?”
It is an issue that has been around for some time. In 1986, Brian Klee, as LUA president, said in an address to members that work needed to be done to improve consumers’ perception of the industry’s value: “Neither LUA nor the life companies have communicated clearly the role and responsibilities of the life underwriter. Instead each have been totally absorbed in promoting products, name and their importance. As a result, the public doesn’t appreciate the true value of a career life underwriter. Those that have a personal life underwriter invariably believe he or she is tops. However, they have little time for life agents in general. How can that be?”
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