Zacary Leeson

The Financial Planning Association of Australia (FPA) has announced the winners of the 2020 FPA Awards.

Now in its eighth year, the FPA Awards recognises exceptional financial planners, paraplanners, university students and FPA Professional Practices from across Australia.

The awards also celebrate the individuals and businesses who go above and beyond to deliver outstanding results for clients and give back to the community.

The winner of the coveted FPA CERTIFIED FINANCIAL PLANNER® Professional of the Year Award is Zacary Leeson CFP® of HPH Solutions in WA. The award acknowledges Zacary’s positive impact on the lives of his clients, as well as his inspirational work in the community through the charity, Leading Youth Forward.

FPA CEO Dante De Gori CFP® said: “Zacary exemplifies our FPA membership as a modern professional financial planner who is client dedicated, university educated and an experienced CFP professional.  Zacary’s passion for the value of advice and his confidence shone through his presentation to the FPA Awards judges. He’s an incredible role model for young financial planners.”

The winner of the FPA Professional Practice of the Year Award is WA-based HPH Solutions (WA). The judges commented that the team at HPH Solutions embody the essence of a true FPA Professional Practice and said that the leaders and staff should be congratulated for the valued work they undertake for their new and loyal clients.

Winning the FPA Financial Planner AFP® of the Year Award for 2020 is Nat Daley AFP® of Hard Line Wealth (NSW). The judges noted that Nat demonstrated his premise of health, love and wealth in everything that he does – from the advice he provides his clients to the way he has established and developed his business with his partners.

This year, the FPA introduced a new FPA Advice Innovation Award to recognise members who have automated their advice process or used technology in new ways to engage with clients and/or deliver advice. The inaugural winner of this award is Corey Wastle CFP® of Verse Wealth (VIC). Corey and the team at Verse Wealth foster a culture of continual innovation, an incredible focus on attention to detail and a drive to continuously improve their business by removing inefficiencies and pain points in their advice process.

The FPA Paraplanner of the Year Award was given to Emma Zwaan of Capital Partners Private Wealth Advisers (WA). The judges commented that Emma’s Statement of Advice (SOA) submission showed an ability to adapt the communication style towards the client’s situation and articulate how the client is put in a better position as a result of the advice.  Emma also demonstrated technical, research and strategic skills in all areas.

The joint winners of the FPA University Student of the Year Award are Miles Kitt of Charles Sturt University and Anthony White of TAFE NSW. Miles showed an outstanding commitment to academic studies and a wide perspective on current issues, as well as a passion for helping people improve their situation. Anthony served as an officer in the Royal Australian Air Force for many years, and as a part of his counselling responsibilities, he became aware of the impacts that financial stress can have on individuals. Now a veteran, Anthony is focused on becoming a financial planner and supporting wounded veterans through the Department of Veteran Affairs system, entitlements process, and Military Super program, as they enter civilian life.

The winner of the FPA Community Service Award supported by the Future2 Foundation is Shane Hayes of Family Aged Care Advocates (NSW). The judging panel said that Shane’s dedication to the profession and his support of the Future2 Foundation is inspirational.  Shane displays an amazing amount of humility and passion when he speaks of how our profession can make a difference to everyday Australians.

The FPA gratefully acknowledges the time and expertise provided by the 2020 FPA judging panel:

• Mark Alexander CFP®
• Naomi Alletson AFP®
• Vicky Ampoulos
• David Andrew AFP®
• Jason Andriessen CFP®
• Jason Andriessen AFP®
• Marisa Broome CFP®
• Diana Burgarcic
• Susie Erratt CFP®
• Giles Gunesekera
• Andrew Harris CFP®
• Alison Henderson CFP®
• Fran Hughes CFP®
• Fraser Jack
• William Johns CFP®
• Gary Jones AFP®
• Todd Kennedy CFP®
• Andy Marshall
• Ben Marshan CFP®
• Mark O’Toole CFP®
• Anne Palmer
• David Sharpe CFP®
• Michelle Tate-Lovery CFP®
• Sharon Taylor
• Phillip Win CFP®.

Photographs and a video reel featuring the 2020 FPA Award winners are available on the FPA website visit

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Phillip Win

There are many financial planners who may not have formal studies and qualifications, but who have clearly demonstrated an ethical, professional attitude and behaved in a manner that has allowed them to forge strong relationships over many years. In many cases they are also maintaining Continuing Professional Development (CPD) at more than minimum standards.

However, there are also some financial planners who may have been attracted to the industry due to financial incentives and its (current) ease of entry. Some of these individuals have not demonstrated the behaviour expected of a person advising on a client’s life savings. This conduct is being revealed to the public via evidence in the Royal Commission into Financial Services.

Financial Planners are under the spotlight and FASEA is forcing many to consider their future in the industry.

Planners close to retirement

Many of those at the mature stage of their working lives are already considering retirement, and the FASEA requirements may well accelerate that. The industry may well be the poorer due to the drain of corporate memory. These clients will also need to be transitioned to a new financial adviser who is suitably qualified under the
FASEA standards. Will clients be happy?

The businesses of those retiring will need to be sold. This will require finance from a banking sector that has made it clear will be harder to borrow money from. The appetite for banks to lend to the financial planning sector is low, especially when you consider they are now looking to divest their wealth management businesses.

What will happen to practice valuations with a change in the demand and supply dynamics? If the sorts of numbers reported elsewhere in the media are true (some suggesting over 50% of planners may exit), this demand/supply imbalance could threaten the very thing financial planners have worked with their clients over the years to achieve – their own financial independence.

Far enough away from retirement to have to make a considered decision

There will be financial planners who do not hold a “related” degree who will need to undergo considerable additional study to meet the proposed FASEA standard by 1 January 2024. Even if a financial planner holds a related degree, they will still need to undertake a bridging course of 3 subjects, covering Chapter 7 of the Corporations Act, the FASEA Code of Ethics and a course of Behavioural Finance.

Financial Planners will need to assess if they wish to undergo the additional studies to stay in the industry. They will need to balance their existing work and family commitments with study requirements. Some may choose to exit, while others will take on the challenge.

The dynamics noted for planners close to retirement will play out for those choosing to not take up the study challenge, accelerating turnover in our industry.

How will FASEA impact your recruitment process and your business?

In short, it will be expensive. Partly because, for most firms, additional study time will be required for existing planners, and many firms will need to support some or all of the direct costs of the extra study, if they have an employee model. Even if this isn’t the case, extra study time is time away from supporting existing clients and helping the firm grow.

It’s also possible that the changes will increase wages costs of those planners who do meet the criteria. Planners exiting the industry because of the changes will create vacancies, and new entrants to the industry with the qualifications already complete will be in high demand – accelerating this trend.

Employers will need to ensure that prospective financial planners actually hold the qualifications they say they have, imposing additional checks and costs and slowing down the recruitment process. If the financial planner does not hold a related degree, the Practice may need to pay for the employee to get their degree and further studies, and support their professional year, in order to stay competitive in recruitment.

It will be very important to ensure that a Practice’s policy statement for study is robust and clear for employees.

Parting thoughts

I feel that much of the recent attempts to “formalise” codes of conduct and how financial planners should work with clients was all laid out when I joined the industry over 20 years ago. The code I signed up for was very clear on what was expected from me as a (then budding) financial planner.

up to, and be held account to, a short, unambiguous and robust code of conduct with this principal at its core irrespective of their association memberships.

I am concerned by the current proposal to not recognise the CFP Program (apart from possible subject exemptions). This program is high-quality and I believe it more than adequately meets the requirements of what FASEA is attempting to achieve. In my view it should be recognised as an accepted qualification for all those who have attained the program by study (rather than ‘grandfathered’ into the designation).

The FASEA proposals should also address financial planners’ CPD requirements. There is little to be gained to by studying Chapter 7 of the Corporations Law and then never reviewing it again. Behavioural finance is another subject that should form part of CPD components, not just be a one-off “tick-a-box” course.

I have a good friend who is a financial planner and to whom I would refer my closest and dearest family and friends. He does not have a related degree and is close to retirement. He is one of the best financial planners in our industry and yet he will need to make some serious decisions in the coming years on what he will do. He is technically superior to most planners I know and is a trusted advisor to his clients. Perhaps he is collateral damage and an unintended consequence of our industry on its journey to professionalise – but it’s sad to see such knowledge and talent go to waste.

By Phillip Win, Managing Director, Senior Financial Planner

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While some of the news may not shock you, there are some key takeaways that clients of financial planners should be critically assessing.

What is a Fee Disclosure Statement (FDS)?

The Future of Financial Advice (FoFA) reforms that came into effect from 1 July 2013 introduced the concept of a Fee Disclosure Statement (FDS). The objective of the FDS was to disclose fees paid by a client to a financial service provider over a 12-month period from a set “anniversary date.”

This means that you if you been a client of a financial planner since 1 July 2012, you should have received a minimum of five Fee Disclosure Statements.
It is important to note that the requirements of a FDS not only include the fee payable, but also the services that the financial planner agreed to deliver to you for the fee payable.

I have not received an FDS, can you please explain why?

Your relationship with your financial planner (and how the financial planner is remunerated) may be based on an insurance policy, or an old investment policy, where commissions are built into the cost structure. These commissions are not required to be disclosed in a FDS. However, you are entitled to know what commission your financial planner does receive by simply asking.

If you engage your financial planner on a 12-month basis and you agree to renew your fee each year by signing a new agreement and payment facility, you will not receive a FDS.

If you have a direct debit arrangement in place with no end date, you should still receive an FDS. This is because the fee would continue to be paid to the financial planner beyond the 12-month period if either of you are unable to meet or execute the new agreement.

What has the Financial Services Royal Commission exposed?

The FoFA reforms were intended to give clients the information to reassess each year whether the fee they have paid their financial planner was worth paying for the services received.

The Royal Commission has exposed the fact that some Australians have been paying a fee and received no service. Indeed some clients may not have had an opportunity to assess if they wish to re-engage with their financial planner because they may not even have received an FDS.

What should I do?

You should receive statements for your investments and insurances directly from the institution providing the products. If a financial planner is “attached” to a financial product, it will be referenced in those statements. The noted financial planner may be receiving remuneration and until you contact them and ask them how much and what services they are providing for the remuneration they are receiving; the gravy train will continue.

It is important to note that if you do decide to remove the financial adviser from the policy/investment, the cost of the investment may not decrease! In some cases, that fee may merely be redirected to the financial institution administering and managing the policy/investment. Sometimes this is just policy of the institution, other times there are real systems & structural barriers to changing this (especially for legacy products). Either way, an alternative is to transfer the policy to a financial planner who actually delivers a decent service for the money.

Without exception, our clients seek to grow and protect their wealth. The starting point is to take responsibility for your financial wellbeing and undertake a financial health check. If you have the time and inclination, you can do it yourself. Or you can seek the services of a financial planner who can clearly demonstrate that they deliver a valuable service in return for the fees they earn

After all, you work hard to accumulate wealth and it’s only fair and reasonable that if you pay someone to work with you, that you can assess if the service is worth paying for.

By Phillip Win, Managing Director, Senior Financial Planner

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Kristine Pham

If you are a person who has achieved a stage of financial independence, it is vital that you have an effective Estate Plan to protect you and your family. An Estate Plan is not limited to having a Will. It generally involves more complex decisions around the control of your personal, family and business affairs in the event of death or incapacitation.

If a plan is poorly constructed and communicated, it can lead to damaging disputes. We’ve all heard the horror stories:

• You may have heard about the Rinehart family feud?
• Or the family who never reconciled when the granddaughter took her grandmother’s antique engagement ring?
• How about the estate that got whittled away to nothing by legal fees?
• Or the neighbour who passed away without a Will and suddenly a mistress emerged in the aftermath?

Poor planning, lack of open communication, high emotions and high stakes when handling an estate are a combustible mix and can lead to family relationships breaking down. None of us want this in theory – but it happens tragically often.

This article focuses on ways to help ensure you avoid such problems by putting in place an effective Estate Plan – by which we mean one that is complete, valid, and well-communicated.

Having the tough conversations around your estate

Having a conversation about your own, or a family member’s, mortality isn’t easy. It touches on everyone’s values as well as the health, wellbeing and relationship dynamics of all the related parties – often difficult issues! And the logistics can be tough too. It’s rare for all family members to be in the same place at the same time, and when there is a gathering it’s usually for personal or seasonal celebrations – which doesn’t naturally lead to discussion of a family member’s aging.

But doing this is absolutely essential. Ensuring your wishes are clearly communicated, and giving key people a chance to have their say about roles and responsibilities, can save a world of trouble down the track. And with the increasing incidence of Alzheimer’s, once a person is diagnosed it becomes extremely difficult to obtain legal verification of their wishes. It is often at a crisis point when people become physically and/or mentally incapacitated, that critical financial and care related decisions are made. Having the conversation early and clarifying wishes can help the loved ones left behind to understand decisions, rather than being angry and resentful when it’s too late to make any changes.

Preparing for the conversation about health, wealth and the future

It’s important to make a specific time and place for the conversation, and ensure it suits all involved. Trying to rush the conversation without adequate preparation, or in the wrong setting, can cause unnecessary upset and not achieve the desired outcome.

A good starting point is to frame the conversation in the context of the person’s health. As a natural part of aging, emotional, mental and physical functioning capacity can wear away. And for many people, a difficult health diagnosis is the trigger for this conversation.

Conversation starter tips:

“I’ve been thinking for a while, that we should probably chat about what we all want to happen in the next few years as Grandma is getting on.”

“It’s always better to do this early while there isn’t any big health problems that we have to react to quickly, so I was wanting to ask after your grandmother after her bad turn last month.”

Conclusion

The process of formulating and implementing an effective estate plan can be confronting and time consuming, and many people put it off until it is sometimes too late. However, engaging in open dialogue and legally formalising what it is that you really want does make everything so much easier for you and your loved ones in the long run. A complete, effective and well communicated estate plan is vital to promote family harmony and to leave the right legacy of your life.

If the steps outlined above seem daunting, a capable Financial Planner can help! A large and important part of our role for our clients, is helping them through this process. Involving your planner as an impartial outsider can really help defuse tensions and ensure your wishes are carried out.

By Kristine Pham, Associate Financial Planner and Phillip Win, Managing Director

The post Crucial conversations: achieving an estate plan that stands the test of time appeared first on AdviserVoice.