A few good planners

In the wake of the CBA scandal, plenty of people are wondering if there is such a thing as a good financial planner. Penny Pryor discovers there is, and manages to track down three.

Who'd want to be a financial planner these days? With the Commonwealth Bank Senate Inquiry, Future of Financial Advice (FoFA) reforms, the wind back of FoFA and the wind back of the wind back, not only are advisors dealing with a severely dented collective reputation, they also have a raft of new regulation, which could change again within weeks.

The industry, led by representative organisations, has tried to transform itself over the past decade and shake off the perception that all advisors are commission led. But at the same time it has been trying to do that, the big banks and financial services companies have been buying up distribution and now own over 80 per cent or more, at a rough guess.

Fortunately, there are still independent financial planners out there, ones that charge a fee and truly believe that people can benefit from good advice that's not necessarily related to a product. Their motivation often comes from a poor advice experience.

"It's very hard to have a stronger voice because the big players own distribution." Kate McCallum, Multiforte Financial Services

Kate McCallum (pictured) had been in the financial services industry for nearly two decades when she decided to seek some financial advice. She was shocked at what was recommended for her, which was against her wishes as well as being a highly risky strategy.

"For me that was a real turning point," she says.

It was after that experience and the realisation that there was a real dearth of good strategy advice, as opposed to product-related advice, that she decided to become a financial planner. Her husband joined her in the business, which they started up in 2007, after six months of due diligence. It is strictly fee for service.

The tagline for the business - Multiforte Financial Services - is "Live well. Sleep well " and McCallum is truly passionate about the value of strategic advice and what it can do for clients' lifestyles and wellbeing.

"There are good advisors out there," she says.

And although no longer a member of the Financial Planning Association (FPA), which she says was a business decision, she has a group of like-minded financial planners who co-refer and meet to talk about different business and advice issues.

One of the financial advisors in her network is Nigel Baker, founding director of Arch Capital.

"I started with a bank...they are terrific training grounds." Nigel Baker, Arch Capital

He was also driven to enter the industry by a passion to provide good financial advice and education.

"Recently I was an accountant and saw a lot of clients with poor outcomes from conflicted advice and poor products," he says.

General manager, financial planning at not-for-profit super fund First State Super, Andrew Vogt, says that most financial planners try to do the right thing.

He has been in the industry for over twenty years and has worked on the retail side and also in banks.

"I started with a bank...they are terrific training grounds," he says.

But he enjoys working for an industry fund and the "clarity of purpose" he finds there.

"What I like about the industry fund world [is the] focus on putting the member first and focussing on the member needs and the outcome for the member," he says.

"We don't have a shareholder in the background."

The First State Super planners mainly advise on superannuation but can also advise on other investments and have an approved product list that includes other products.

Vogt says they do not struggle to find clients, with plenty of interest from fund members, and the financial planning business is growing rapidly.

But for the smaller independent planners it can be a hard slog.

Baker and McCallum say that without the large marketing budgets that the banks have, it can be difficult to get the message about independent advice out there.

"It's very hard to have a stronger voice because the big players own distribution," McCallum says.

But there definitely is a demand for the fee-based service.

"There is a lot of demand out there for independence. It's just hard to get the word out there," Baker says.

McCallum urges people not to be put off by the bad rap CBA has got, and rather educate themselves and be prepared to question an advisor when they see one, if they don't understand what is being proposed for their money.

She is afraid that in the aftermath of the CBA scandal, people, who could really benefit from some good advice, will decide not to get it, and that would poor outcome for everybody - not just the people directly impacted by the rogue CBA planners.