the foto fanatic wrote:I spent 40 years in the financial services sector, and while there has been a quantum leap in transparency over that time, the consumer isn't yet being fully equipped with information. Look
here.
And, I'm not just bagging advisers - I was one. The fund managers, product designers and actuaries are are more to blame really.
Unfortunately, people also tend to congratulate themselves when the market runs in their favour, but bag their adviser when the market turns down. You just can't win sometimes.
It's a shame I wasn't more into self promotion, otherwise I would post
this link.
I disagree that the fund managers, et al are to blame. The advisers who take commissions and who are incentivised to:
1. Recommend a product that pays a higher commission.
2. Recommend, inappropriately, that a client borrow money to invest to increase commissions or funds under advice from which fees are charged.
are to blame.
Fund managers will do what any business will do - try to increase sales and profits.
It is the sales force who scream "we are not influenced by commissions" yet are paid by a third party, not the client, who are often hypocritical.
Most advisers will try to do the right thing by their client. Unfortunately, they work in a structurally compromised system where they are paid by the product manufacturers.
Until this is rectified, my industry will not be considered a profession. And the Storm Financials will continue to exist, and Westpoint/Timbercorp products will still be sold to consumers.
What is required is a government funded incentive for the average consumer who is, with all due respect, financially illiterate, to seek independent advice, as hard as that is to find. A tax rebate on planning fees is the best way to encourage those who need advice the most to get it. Tax deduction of planning fees only helps the wealthy.
Sorry, just a little off topic.
Posted: Wed Jul 01, 2009 5:48 pm
