Entering the Financial Planning Industry

by HLK Group HLK Group

Although the Financial Planning industry promises to be lucrative, it is by no means easy to enter. It is highly regulated in order to provide the best possible advice to the public and the regulators are constantly working at ensuring that consumers are treated fairly. Financial advisors have a lot of influence over clients' decisions to purchase specific financial products, and therefore the Australian Securities and Investments Commission demands that you meet certain entry criteria.

Financial Planning Training Standards

As a financial adviser, you must hold an Australian Financial Services (AFS) licence and you must meet minimum training standards. If you don't hold your own AFSL or if you are exempted, you may work as an authorised representative of an AFS licensee.

In terms of training, you should hold proof of initial training and you should maintain ongoing standards as defined by ASIC's Regulatory Guide on training for financial product advisers. Furthermore, you should complete ongoing training in your area of specialisation. Minimum requirements are equivalent to Diploma level and comply with Tier 1 RG 146.

Training and qualifications completed before September 2012, will only be recognised if they are listed in the ASIC Training Register. Subsequent courses should be certified by the Higher Education provider or the Registered Training Organisation to meet RG146 requirements.

Since 2013, seventeen universities have made available curricula that prepare students for financial planning qualifications. The aim of this initiative is to generate a consistent pipeline of future financial planning graduates who have the right qualifications.

Once qualified, you would work your way up from the bottom, starting with an entry-level administrative role in order to gain a solid understanding of financial planning. After completing around twelve months in an entry-level position, you may progress to a paraplanning role, which would last another two years. In this role, you will be exposed to the basics of planning, strategy and the regulations that govern the financial planning industry. During this time, you will complete the certified financial planner course, which consists of five modules.

Individuals with specialised knowledge, especially those with experience in working with certified planners may enter the industry at higher levels. Lawyers and accountants sometimes have to complete the Certified Financial Planner (CFP) course, and that is why they are able to enter at a higher level.

If you wish to be a financial advisor, you will have to obtain an AFS licence, or you should become an authorised representative of an AFS licensee. You will have to first gain some experience before you will be able to obtain the AFS licence.

However, there is an alternative to applying for an AFS licence, and that is to opt to work as an authorised representative of a licenced financial provider. You will be able to advise on or sell the same products that the financial provider offers and is licenced for.