Financial advisers will need to be flexible and leave behind the cookie cutter model to help service self-managed superannuation funds (SMSF) better, according to a report.
‘The SMSF Report’ by the Commonwealth Bank (CBA) and the SMSF Association found genuinely specialised advice would help trustees be more engaged and informed.
CBA head of SMSF customers, Marcus Evans, said advisers would need to understand what SMSF profile would best fit their clients and that they would need to work to deliver an advice proposition that would most closely align with that.
“There has been tendency across the whole advice industry to kind of be cookie cutter and we’re going to have to expand that in the future,” he said.
The report found there was a new generation of SMSF investors – the self-directed investor – and identified the other profiles as the outsourcer, coach seeker, and controller.
Outgoing SMSF Association managing director/chief executive, Andrea Slattery, said there was an interest for trustees to have direct engagement, direct purchasing power, and be directly engaged with financial affairs.
On the accountant’s exemption, Slattery noted that trustees were going to have to rethink where they were going to get their advice from.
“That one-stop shop model that so many accountants and financial planning models are starting to set up, needs to be looked at and worked out how they can integrate and so you’ll see a lot more of those one stop service models starting to make things simpler and more efficient,” she said.
“For existing SMSFs you need to understand how they can still get the advice they need because they still might want to go to their trusted person who’s going to have to outsource a lot more.”
Evans said accountants would be a key source of referrals for advice.
“That trend towards that one-stop shop and having associated accounting with financial planning and advice together will be a feature of a model going forward,” he said.
“There’s also a huge opportunity in unmet advice needs. Fifty per cent of advised SMSFs and 59 per cent of unadvised SMSFs say they have unmet advice needs. One of the reasons is that quite often it’s hard to find the specialist in a particular area you want advice and the other is that we live in an age where finding information is not difficult, it’s actually sorting through that info and filtering out.”
The report found for advised SMSFs, 48 per cent turned to independent financial planners, followed by accountants (46 per cent), financial planners at a super fund (13 per cent), financial planners at a bank (12 per cent), and specialist super consultants (12 per cent).
On average, SMSF investors had 1.4 advisers with 37 per cent of advised SMSF members seeking advice from more than one source.