There’s no doubt the financial advice industry hasn’t had much good press lately but, according to one industry expert, the problems that have now come to the fore also bring opportunities.
“The industry will fix itself. When it does, the need for financial advice will always be there but the model in which it’s delivered to people is rapidly changing,” says Pat Garrett, chief executive of robo-investment firm Six Park.
“It’s a really good time for people starting out,” he says.
The future of financial advice, as Garrett envisions it, is people centric: a world where the client comes first, as opposed to an industry primarily focussed on making sales and promoting products. Yet this client-centric world will also be highly automated.
Take the growth area of robo-finance, a segment of the finance industry that’s booming overseas and which has recently started to take off in Australia.
“Robo-advice has automated a high percentage of the activities related to investment management. But behind it there are human experts who provide oversight,” says Garrett.
These human experts include technical developers, engineers, web developers, user experience specialists and people familiar with the world of investment management and finance. It’s all part of an industry many say will look very different in ten years’ time than it does today.
Garrett agreed that old school investment roles, which involved sales-oriented staff being paid by product providers, will soon be a thing of the past.
“Robo-finance is a much more robust solution where the client is the centre of the universe, and the technology, education and communications are all wrapped into the service,” he says.
While active stock picking has previously been seen as a glamorous aspect of finance, Garrett says many of those roles have now been commoditised, meaning that it’s hard for the market to distinguish between the offerings of different providers.
“What is getting more important, and I think is more rewarding, is engagement with clients on their behaviour and emotions … it’s helping coach people about things like why super matters when you are young, not just when you are old,” he says, noting that skills in behavioural economics are becoming increasingly sought after within the financial services industry.
Study: Typically, employees building a career in finance will start with undergraduate qualifications in economics, maths, finance or accounting.
“They are not the most glamorous fields of study but they are critical – they can help in many ways across a variety of different roles,” says Garrett.
Skills: Even if you end up working outside finance, a good grounding in economics, statistics and commerce can be highly marketable.
“Working in this industry requires skills that are very transferable across industries: problem solving, strong analytic skills, customer relationship management and coaching. With the financial industry in a state of change, this is more true now than ever,” says Garrett.
Tips: “It’s prudent for anyone interested in the world of finance to get the basics in the early days, then test the waters in the various streams and learn where your passion, opportunities [and interests] lie,” says Garrett.
Source: Thanks smh.com