“The RDR forced many to go to level 4 – quite unnecessarily, since people who decided to call it a day had already achieved level 3 and were doing their job perfectly well. But the new rules meant they would need to go back to studies,” says Blair Cann, a senior partner at M Thurlow & Co in Hertfordshire. “After all, how many advisers aged 60-plus wanted to be told they had to go back into the exam room? This particular RDR requirement forced a number of decent IFAs out of the industry.”
But other advisers think the change in qualification levels was important since advisers work in a constantly changing environment and need to upgrade their skills from time to time.
Tim Collyer, a chartered financial planner at Leeds-based Alexander House, says, “I served on a consultation panel where we as a group determined the appropriate standards that should be met by all advisers. Overall, the level decided on was a little higher than the financial planning certificate, but less than half the distance between there and the advanced financial planning certificate.”
He adds, “I was part of a group that felt that the advanced financial planning certificate should be the requirement to give advice; others in the group felt that chartered should be the minimum standard.”
While the change has sent advisers back to their text books, spending long hours studying for the next levels, it has also brought more confidence, especially as they are dealing with clients in a constantly changing environment. Events like the pensions freedoms have brought the role of financial advisers to the fore. But do clients care what qualifications their financial advisers have?
“Clients rarely ask as the letters mean nothing to them,” says Graeme McColgan, a London-based financial planner at Million Plus Financial Planning. “However, I believe that they can tell if you know the legislation and this tends to be as a result of exams or further learning.”
But Mr McColgan explains that qualifications are more important for introducers to know that they are passing the client to a trusted adviser, “This has been an issue in the past where relationships have been tainted or even ruined by poor advisers or poor advice. Inevitably, the issues come back to haunt the person that refers them and often make them reluctant to refer again.”
For a lot of clients, it is important that their advisers have gained the required financial qualifications. They also prefer a chartered financial planner in many instances. Advisers who have the chartered badge say their qualifications have had a significant impact on professional relationships with accountants, solicitors and clients. However, a significant number of advisers approach clients through referrals and so it is unlikely that they ask the adviser for their qualifications.
