SMSF Association gives thumbs up for improved financial advice standards

The SMSF Association welcomes the parliamentary approval of the Government’s legislation that aims to improve the educational and ethical standards of financial advisors.

The Corporations Amendment (Professional Standards of Financial Advisers) Bill 2016 was passed by the Senate yesterday with the new education and ethical standards taking effect from 1 January 2019.

From this date, new advisers will be required to hold a relevant degree before they are eligible to start the supervision year and sit the exam. Existing advisers will have two years, until 1 January 2021, to pass the exam and five years, until 1 January 2024, to reach a standard equivalent to a degree.

Association Managing Director/CEO Andrea Slattery: “On the eve of our National Conference, we could not have wished for better news.

“We have long advocated the lifting of educational and professional standards in the financial advice sector as a critical step to ensuring the consumer has access to the best financial advice.

“Higher educational standards are essential to nurture a respected financial advice profession and give consumers confidence in the advice they are receiving.”

Slattery says the Government is to be commended for adopting a co-regulatory approach that gives the industry a high degree of responsibility to improve professionalism in the advice sector.

“The establishment of a statutory standard setting body to govern the professional standing of the financial advice sector is an excellent step, and our Association looks forward to working closely with it.

“A key priority will be to ensure that the new education standards recognise the importance of specialist advice areas, such as SMSF advice, which is critically important as about 1.1 million Australians have $636 billion in retirement savings invested through the SMSF sector.”

Slattery also welcomed the transitional timeframes to allow current advisors to meet the new educational standards.

“While we welcome the generous transitional timeframes, I remind advice professionals that they should not be complacent and remember that it is there professional duty to their clients to keep improving their knowledge and skills.”