What’s it like being a brand new financial adviser coming into the advice industry/profession?
Well that happened for me just over 30 years ago, and although that’s a long time ago, I can still remember what it was like. A short period of sales training, go out and find clients, mostly family and friends “because they are more likely to help you get started.” And it’s commission only.
If you didn’t sell, you didn’t eat. And you were given a target for sales production, based on premium income sold, or how much other people’s money could be gathered to be invested in some bloody awful funds. Clawbacks? Yeah, they hurt. Getting ‘unpaid’ for work you did months ago is a mug’s game.
Still… a crap investment is better than no investment, and we’re entitled to make a living, right?
So, how are things 30 years down the line?
I was asked to connect on Linked In with someone who had not spent very long as a life office financial adviser. I asked him what the story was, and this was what came back…
To protect the guilty, I’ve also removed the name of the organisation, but frankly it could be any one of the big life offices or their franchises. He apologised for the language, but I feel his pain.
What’s changed? Nothing has changed.
The industry continues its decades-old methods, because it still wants what it always wanted. I wonder if this individual was described, upon his exit, as ‘not tough enough’ or ‘unable to sell’ or ‘not the right calibre.’ The crazy thing is that with the right kind of support, he would probably be a great financial planner. But he’s done with the industry. We’ve lost his potential and he’ll be replaced by another pumped up salesman.
We can’t change the industry, and it won’t change voluntarily. I very much doubt that regulation will have a significant impact. I’m at the point actually, where I doubt that most financial advisers will change. The culture is so firmly entrenched in the mindset, that it’s going to take a very long time. In fact, I believe that the best recruits for financial planning are outside of the industry completely. Nurses and social workers maybe, who probably won’t need much persuasion to care and empathise with people, and who could easily learn the numbers – they’re not difficult. I reckon they would probably make good lifestyle financial planners.
What if clients understood the game?
What will change things though, is when customers and clients of financial services companies wake up to what’s happening, begin to understand how the game is played, and are shown a better alternative. One that’s genuinely about them, and not the industry.
If they care about it and if they start demanding it, then I think we shall see a different story.
In the meantime, plus ca change, plus c’est la meme chose…