Research highlights need for advisers to prepare for battle
National President of the Association of Financial Advisers (AFA) Dr Jim Taggart, OAM says recent research published by Roy Morgan Research around the low level of consumer trust in advisers means advisers must prepare for battle.
“Trust is fundamental to the advice relationship,” Dr Taggart said. “We know from our own Back to Basics consumer research that those who have advisers highly trust them – in fact they rank advisers as the most trusted professional, after specialist doctors and dentists. However, those who don’t have advisers don’t trust them. We have to ask ourselves why.”
Dr Taggart said the industry funds movement’s multi-million dollar anti-adviser advertising campaigns had a lot to answer for. “Such campaigns only stoke and prolong the crisis in consumer confidence brought about by the global financial crisis,” he said. “Members’ money could be better spent on campaigns which set about restoring confidence in superannuation and advice, so that consumers are better positioned to grow their wealth and protect their assets.”
However, Dr Taggart said that if the industry funds movement intends to continue with negative advertising campaigns, advisers must prepare for battle.
“We have been too quiet for too long and ultimately, silence becomes consent,” Dr Taggart said. “The future of advice is now up for grabs and the only people who can fight this battle are those of us who truly believe in the value of advice. No-one else is going to fight our battles for us. We have to stand up for what we believe in.”
AFA CEO, Richard Klipin said the Roy Morgan research reinforced aspects of the AFA’s Back to Basics Consumer Research, conducted by CoreData/brandmanagement earlier this year.
“The Roy Morgan analysis says what the AFA has been saying for some time now,” Mr Klipin said, “And that is that the current proposed “reforms” may actually limit consumer access to advice.”
Roy Morgan analysis revealed:
- a ban on commissions may make financial advice unaffordable for the very people who need it most
- proposed ‘reforms’ may in fact impede access to financial advice
Mr Klipin said the AFA will be making a major announcement in relation to restoring consumer confidence in advice at the AFA National Convention which opens on the Gold Coast on Sunday.
The AFA’s Back to Basics Consumer Research, conducted by CoreData/brandmanagement earlier this year revealed that people who receive advice:
- highly value that advice
- are better off
- have greater peace of mind
- have greater control of their financial future
- rate financial advisers as the third most trusted professionals, after specialist doctors and dentists
The Back to Basics White Paper can be downloaded here
