Regulation uncertainty to escalate adviser struggles

financial advisers regulatory uncertainty

The latest sector research shows financial advisers expect the challenge of regulatory uncertainty to increase when it comes to servicing SMSF clients.

Financial advisers are anticipating the challenge of regulatory uncertainty associated with servicing SMSF clients to intensify in the immediate future, according to the latest research into the sector.

Thirty-seven per cent of SMSF planners surveyed for the “2019 Vanguard/Investment Trends Self-managed Super Fund Reports” said they expect regulatory uncertainty to increase over the coming three years.

In comparison, 26 per cent of respondents thought this component affecting their SMSF business was going to decrease or at least stay the same.

With regard to their current circumstances, advisers participating in the study ranked regulatory uncertainty fourth among the key service challenges stemming from their SMSF business, with just over 30 per cent responding in this manner.

The top three challenges advisers cited as their greatest SMSF business struggles were compliance (36 per cent), dealing with situations where accountants had set up an SMSF for unsuitable individuals (35 per cent) and educating clients about their responsibilities as trustees (33 per cent).

“When we talk to them about what do they think their challenges are and which of those they think will grow or change over time, they think that most things are going to become harder. And they’re probably right post royal commission,” Investment Trends chief executive Michael Blomfield said about the result.

“They’ve got a lot of work that they’ve got to do, but regulatory uncertainty is one that we do see constantly as an issue that makes life hard for people who invest and for the people who advise them.”

Other difficulties advisers who took part in the survey cited involving the servicing of SMSFs include administration (25 per cent), keeping fees competitive (21 per cent) and client acquisition (19 per cent).

Other findings from the research showed SMSF advisers are changing the product suite they are recommending to their clients in order to better satisfy advice needs.

The views of 286 financial planners were sought for the study, which was conducted online between February and April.

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