For most practitioners in our sector May and June tend to be months to look forward to – the end of Spring and start of Summer tends to signal a tradition of upbeat activity, particularly in the housing and mortgage markets and, given that the Election is now over, we might anticipate those who have perhaps been holding back to now forge ahead.
However, at this time of year I have to spare a thought for schoolchildren and students who view these next couple of months – exam season – with barely-concealed trepidation and fear. For those who can remember back that far –or those who have children – this can be a period of constant stress with constant revision sessions, borderline insanity as the exams themselves get closer, and often blind panic. And that’s just the parents.
The focus on exams and qualifications is not just felt by those in secondary or higher education it has to be said. The advisory profession often feels the hot breath of the regulator when it comes to fulfilling qualification responsibilities and, in recent years, meeting higher standards in order to continue trading. Leading up to the RDR a few years back, many financial advisers found themselves in a situation where they had to ‘gap fill’ their qualifications in order to secure their ongoing livelihood in the profession. Many were either unable to do so or felt it was not worth their while – the number of advisers fell.
So far, it has to be said, mortgage and equity release advisers’ have not had anywhere near the same level of pressure brought to bear on them with regard to up-scaling their professional qualifications. The requirements have stayed constant despite the move to Level 4 and above for other advisers, and as time moves on this has led to an argument which not only suggests that a similar RDR-type move is required but that it is probably inevitable, and advisers should therefore get ahead of the curve behind they are compelled to do so.
The official line from the FCA, when it comes to a move to Level 4, has remained a steadfast, “We’re not looking at it”, and one might think that given everything it has on its plate, there is little chance of it doing so in the very near future. However, the important point to remember is that the regulator’s direction of travel when it comes to qualifications has never remained constant for long. The direction of travel is also not likely to be down, so from that we can surmise that at some point in the future, advisers in this part of the market will be asked to make the move upwards.
It’s also the case that given we have a much more holistic retirement advice sector than ever before, there is an argument to suggest that advisers need to be able to prove their knowledge and skills beyond the land of just mortgages or equity release products. The pension freedoms have certainly been a game-changer and no adviser worth their salt should be looking at just one product silo when they see a retiree. At the very least, they should have the knowledge to be able to ascertain needs in other areas outside their specialism, and be able to introduce to the specifically-qualified experts in those sectors.
But, as we move forward, one can’t help feeling that this won’t be enough. At our recent ‘round the table’ event for advisers in Liverpool, Stuart Wilson of the Later Life Academy advocated a future where equity release advisers would need to be Level 4 qualified as a minimum, and where there was an ‘at’ and ‘in’ retirement set of exams and qualifications to be attained which would provide the adviser with a much broader knowledge base in order to deal with their older clients. He also suggested that, while a nice thought, the idea of advisers voluntarily pushing themselves up the qualification scale was not going to work and they would need to be ‘incentivised’ by the regulator in order to get there.
While we await such compulsion, the advice for advisers has to be to broaden their qualification horizons and, if possible, begin that move to Level 4. If we are in a pre-RDR situation currently then there could be adviser casualties if the message from on high does change and greater qualification levels are required. Perhaps better to do the revision and work now so that you can have certainty in your future, rather than have a regulator force you down the line and you being unable to get the necessary pass marks.
For many people, revising, exams and qualifications are a thing of the past but we all know that if we want to stay relevant, up-to-date and employable, then in this industry at least it really is a case of lifelong learning or bust.
Chris Prior is manager for sales and distribution at Bridgewater Equity Release