It’s not easy being an adviser (but why should it be?)

The later life advice market needs its own specialist qualification to ensure the highest possible standards for clients, writes Stuart Wilson

If there were a list of professions judged by how ‘easy’ they are to work within, I’m pretty sure that being a financial adviser would not be near the top.

Indeed, if you were looking for an industry in which to be employed and have ‘an easy life’, I believe most practitioners would hardly be the best champions for the advice sector.

In short, if you’re idea of work is effectively being left alone to get on with the job in hand, then you’re probably best looking elsewhere.

This is not an industry for those who dislike intervention.

On a similar theme, at a recent adviser roundtable event I attended, the discussion quite naturally turned to the notion of qualifications, in particular, the focus on CPD, lifelong learning and the never-ending improvements required by the regulator in terms of qualifications.

One adviser was extremely perturbed that, in his perception, it appeared that financial services sector practitioners were always the ones that were asked to improve their qualifications and their status, as opposed to other industries.

There was a general feeling around the table however that this was unlikely to change anytime soon.

My own belief on this question is ‘why should it’?

Conflicting demands

After all, we are talking about a changeable, fast-paced sector right across the board; one that is subject to a myriad of often competing and conflicting demands from the regulator itself, but also the performance of the economy, the politicians who come and go, and the global markets.

When you work within a sector where the norm is never really known and the changes come thick and fast, is it really beyond the pale to be required to keep up with those developments and to ensure that your qualifications and professional standing are at the very highest levels? I think not.

Indeed, it’s not just those forces listed above that place demands on the sector and those who work within it, but of course the major consideration has to be the demands of the client and their perceptions about the quality of the advice/adviser.

Experience counts for a great deal in our market, however, this should not mean a simple retreat to the products that have worked in the past; it should also mean the client has access to the wide range of new and improved products that are constantly being introduced into the marketplace.

My main focus has traditionally been the equity release market of course and here is a perfect example of a sector which has undergone considerable change in the last decade but has seen some phenomenal developments in the past year or so.

Fundamental shift

The nature of what it is to release equity has fundamentally shifted and the options that clients now have, for example, the ability to pay interest each month, drawdown options, etc, have only relatively recently come into the marketplace.

Again, in this situation it is absolutely imperative that the adviser keeps up to date with what is happening, not just from a product perspective but also when we consider taxation developments or benefit changes – an area which (perhaps more than any other) is subject to countless tinkering which can have a real impact on the client.

Therefore, it seems a common sense approach to require advisers to ensure their own CPD learning is up to scratch, plus I see no reason why increased requirements for advisers in the area of qualifications shouldn’t be the norm.

Most advisers I know, although not the most vocal proponents of this recognise it is necessary and that it is unlikely to happen if it’s a self-certification approach.

That is, if it’s a voluntary option then most advisers won’t drag themselves through a higher qualification process however if it comes from the regulator, then it has to be achieved or their livelihood is gone.

Wider issue

I don’t just believe this is an equity release issue, but across the entire later life advice market there should be a qualification that requires a much wider knowledge base.

This is because of the inter-linked nature of advice for those who are retired – it’s pretty much impossible for advice to be given in silos for these individuals as they need to have all their later life needs looked at, and advised on, in the round.

This doesn’t mean you can’t have specialists within a field, for example, making equity release a gold-standard qualification within later life advice, but it does mean that those specialists should also have the necessary later life knowledge.

I’m afraid that this can only be shown through a qualification process.

So, in that sense the first move would be to move Level 3 equity release advisers up to Level 4; at the same time a later life qualification which proves this wider spread of knowledge could also be introduced at the same level and made mandatory for all those dealing with those with a later life need.

This moves us away from a simple transactional-type approach and focuses much more on the client’s 360-degree needs; it will also deliver a far greater level of confidence from the client in the adviser and, in a guidance world, will help develop a clear pathway through to later life advice for the many thousands of people who will undoubtedly need, and benefit, from time with an adviser.

Stuart Wilson is managing partner at Later Life Academy