CoreData’s recently released adviser retirement projections reveal that 16.5 per cent of survey respondents would rather change careers than comply with the new minimum standards, being that from 2019 new financial planners will need to hold a degree or degree equivalent, and by 2024 existing financial planners must have also completed a degree or degree equivalent.
Meanwhile, 15.4 per cent indicated that they are still unsure of what is necessary to meet the new requirements, and the 68.1 per cent intend to meet the new requirements.
Fortis Accounting partner John Kalachian told Accountants Daily that this doesn’t surprise him.
“When industries put in additional education requirements, businesses have to think to themselves whether or not it’s worth the extra work or time that's required, and if they're very close to retiring maybe they'll say let's just pull the pin instead,” Mr Kalachian said.
“So, it doesn’t surprise me that that's happening.”
Mr Kalachian believes that this will lead to further convergence of the accounting and financial planning industries, as their education requirements level out.
“I would say that it will put more emphasis on accountants and financial planners joining to become one consolidated group, or joining forces as such to become a better practice, because what it does is it makes sure that the educational emphasis is high on both sides,” he said.
“I believe that education is very good because it upholds the industry and it will be better for the client at the end of the day.”
Meanwhile, Deakin University associate professor Adrian Raftery told sister title ifa that he believes the percentage of financial planners who will leave the industry is higher than CoreData’s predicted 16.5 per cent.
“Of course they are leaving the industry,” Prof Raftery said.
“Every conference I go to they say ‘my retirement date is 31 Dec 2023’. The thing I disagree with [is the estimate that] 16 per cent [will leave], as my estimates have it closer to 21-34 per cent.”