Financial planners continue to leave the industry in droves

The number of financial planners practicing in Australia continues to decline across all market segments, according to the March 2021 Rainmaker Financial Adviser report.

There were 20,677 advisers in Australia in the March 2021 quarter compared to 21,081 advisers in the December 2020 quarter, the report found. That was an 11.3 per cent fall on the number of advisers 12 months ago.

While the main reason for the exodus of financial planners may be the requirement for them all to have passed the Financial Adviser Standards and Ethics Authority (FASEA) exam by January 2022, the increasing legal burden and rising costs are also a factor.

Australian Financial Service Licenses (AFSLs) rose slightly over the quarter, by 0.2 per cent to 2169, but were down over the year by 1.1 per cent. Rainmaker sources the data from the Australian Securities and Investments Commission (ASIC).

There is an almost 50/50 split between institutional-owned or aligned advisers and non-institutional advisers at 10,052 and 10,625 advisers respectively.

The big four banks and AMP continue to be the AFSLs losing the most advisers. Over the past 12 months AMP lost a net 339 advisers, NAB lost a net 221 and ANZ lost a net 167 advisers.

On the other side of the ledger, Lifespan Financial Planning gained a net 53 financial planners over the 12 months, the biggest net gain. Capstone Financial Planning also gained a net 31 financial planners.

The Colonial First Choice and AMP Flexible Lifetime platforms are the most popular platforms by useage, being used by 10.7 per cent and 6.5 per cent of advisers, followed by Perpetual Wealth Focus and Asgard, which are used by 6.3 and 5.8 per cent of advisers.