Maybe it’s just because of the general good cheer of Melbourne Cup day but my usual elephant-thick-skin is feeling a little tender at the moment.
It could be just another example of the “straw that broke the camel’s back”. You know, when the accumulation of a long series of nothings suddenly begins to make each new piece of straw feel like an oppressive weight. Maybe i’m just growing old? One way or another, i’m getting a little tired of every financial planner being branded a crook out to fleece the average individual of their hard-earned cash.
Financial Planners Perth
I actually think many Financial Planners in Perth, Western Australia are hard working, caring people who are fully committed to their career choice and to the clients that they deal with. There are bound to be some who push boundaries or are unethical or uncaring – but in my experience that is an extremely rare set of characteristics to find in Financial Planners in Perth. So it really does hurt when people with their own biases, choose to try to improve their own position by trying to make financial planners look like a rather poor lot.
To give you an example, here’s an extract from an email newsletter i recently received…
Earlier this week, I shared my concerns with the way in which I think much of the financial services industry is stacked against us.
Excessively high fees, compromised incentives and a slick sales machine are conspiring against individual investors. Too many Australians are being taken for an absolute ride. It’s nothing short of disgraceful, and it makes me sick.
This is not an isolated circumstance, and this particular note is from an internet investor group that i think offer a very good service. In fact, i’ve been a member of the US version of this self-help site for many, many years. And “stacked against us”? Does the person making the comment make use of the financial services industry or are they just using poetic licence to appear inclusive? Have they been ripped off personally and are taking it out on an entire industry? Are Australians really “being taken for an absolute ride”? A lot of people would say “yes” but i’m going to stick my neck out and challenge this statement on the basis that it grossly oversimplifies the financial services industry in Australia today – and does so purely to generate sales or because of erroneous assumptions. In most cases, “financial services industry” refers to “financial planners” and comments are aimed at this group.
When you read something like this a few days in a row (as i have), you begin to think that there is something amiss in the perspective within which the financial planning community is being viewed.
Are all Financial Planners biased crooks?
Now if you are feeling charitable perhaps you would console me by saying “but that’s not aimed at you Michael”. Perhaps. Think about it for a moment though. If you and every person in your specific field of endeavor were the subject of year-after-year adverts from a multi-million dollar national slander campaign, your life-time business impacted by crippling legislation that so obviously supports others at your expense, and a continuous trail of belittling of your efforts by biased groups, how would you feel? It doesn’t always work to just assure yourself that all that vitriol is directed at someone else.
Don’t get me wrong – i am completely aware that the financial planning communityis not a flock of winged angels. We’re a bunch of opinionated, arrogant, and sometimes blinkered hard-heads, trying to earn a profit while entrusted every day to help people make decisions in the world of money. In amongst we financial planners, as with any group, there will be a minority that do fit the meme of greedy, selfish, uncaring individuals. i can be certain of that fact because i’ve met people of that ilk from all manner of occupations, so there’s no doubt that a few are lurking under the guise of financial planners.
Maybe my skin is being thinned by the complete lack of understanding of what a financial planner does? Almost every piece of legislation, every belittling piece of commentary and every advert that pillories anyone claiming to be a financial planner is based on the assumption that every financial planner in Australia looks the same. That they all do the same things, and act the same way.
And that is categorically not true.
All financial planners are NOT the same
And i dont’ mean the obvious “we’re all individuals” when making that comment. i mean that all financial planners do not do the same thing when they sit down to help people with money issues. Unlike most other professions, there are no “specialist” designations within the financial planning community. This means that financial planners operating under completely different modes of authority and process are all lumped into the same pie. To show how wrong this assumption is, here’s a quick look at just some of the ways in which financial planners can differ…
- Some financial planners only deal with investments
- Some financial planners don’t really deal with investments all that much
- Some financial planners predominantly deal with insurance
- Some financial planners do not deal with insurance at all
- Some financial planners deal solely with superannuation
- Some financial planners deal solely with one component of superannuation – such as self managed super funds.
- Some financial planners can only deal with you if you are able to make an investment
- Some financial planners only provide strategic advice
- Some financial planners only deal with one company’s products
- Some financial planners only deal with one “platform” for investments and insurances
- Some financial planners won’t deal with you unless you have at least (say) $400,000 available for investment
- Some financial planners only deal with listed investments
- Some financial planners don’t deal with listed investments at all
- Some financial planners only charge by the hour
- Some financial planners only provide advice to a particular group of people in the community
- Some financial planners only charge through the products they sell
- Some financial planners are qualified as Accountants, and provide a mix of services
- Some financial planners specialise in estate planning
- Some financial planners work by themselves, with their own licence and support team
- Some financial planners operate by salary
- Some financial planners operate as a “team”, pooling specialist knowledge and resources
And that’s just my shortlist. To make it even more opaque, mortgage brokers and others in the world of money are seeing financial planning as a way of expanding their income base, so brace yourself for even more diversity again.
Comparing financial planners
i am not suggesting that financial planners are all good or all bad or all inept or all ridiculously clever. i AM suggesting that the extremely diverse group of people referred to as “financial planners” are also highly diversified in the activities that they perform. Understanding that will greatly help anyone who is trying to find a financial planner to deal with.
So next time you hear someone making a sweeping statement about the financial planning industry, ask yourself what that person’s own bias might be, and have a think about whether that statement is likely to apply to every financial planner out there because most likely, it will not.
Some very good research has recently been released on how different financial planning groups would deal with the situation of a couple seeking financial advice. The results are startling only to those who are not familiar with the incredible diversity of operations for financial planning businesses in todays highly complex financial world.
More on that in a later post…