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ISCOVER
Staff Reporter
Industry pundits have voiced their concern over brokers making the transition into financial planning.
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Yesterday, The Adviser published an article that said brokers were eyeing a potential move into financial planning.
The Adviser was subsequently inundated with responses from brokers and key industry stakeholders who argued against the transition.
Australian Loan Company’s general manager Lesley Wood said while there are benefits in making the move from broker to planner, there were also some pitfalls.
According to Lesley Wood, brokers who try to become financial planners can often struggle to wear both ‘hats’ effectively.
“Of course, it can be successful for some but it isn’t an easy road. Adding this service can result in difficulty with focus and stretches the broker thin,” Wood said.
Robert Bishop from Commrural Lending Services agrees and believes brokers who make the transition may be in for a shock.
“Brokers would not truly understand the qualifications they need to become a planner,” he said.
“In addition, PI costs could go up. Basically mortgage brokers are regarded by the PI industry as low risk and financial planners as high risk in regards to possible PI claims.”
“For us we will find other ways to expand our income base, and let our contacts in the financial planning industry be a good source of referral, without the associated risks.”
