Why we do not see a future in commissions.
A commission is a payment from a product provider for recommending their product. There can also be incentive commissions if particular sales targets are reached.
As the payment is made by the product provider the perception is that the “advice” is “free”. Very little in life is free. Current legislation requires an Authorised Financial Adviser (AFA) to declare “conflicts of Interest”. There is always the temptation to recommend solutions that help meet sales targets!
Objective, independent advice can only be transparently achieved through a fee for advice service. Anything short of this can easily fall short of a “client first focus”.
At SFP any commissions that cannot be rebated at source are credited against clients fees, which in the case Portfolio Management are usually tax deductible.
An Authorised Financial Advisor has a rigorous professional pathway and is highly regulated and can give advice on Financial Planning, Investments, KiwiSaver, Pensions / Annuities, Mortgages and Insurance.
A Registered Financial Advisor.…just has to be registered and can give advice on Term Deposits, Mortgages and Insurance.
Michael Taylor CFPCM AFA