Welcome to the current edition of The Australian Journal of Financial
Planning.
The aim of this journal is to be the definitive source of reference
material and case studies on the issues facing the financial planning and
advice community.
The financial markets are still a long way from their historic highs and
it would seem that no one is willing to predict when the bottom will be reached
or over what period the market will return to those long-term high points.
The world now seems beholden to massive government backed stimulus. Some
argue it is essential to ensure economies continue to function. Others
say that the government borrowings simply mean that future generations will
have to take on the job of repaying all this debt.
Only time will tell who is right.
The patron of the SMSF Professional Association, Sir Anthony Mason, said
at its recent annual conference that, "it is to be hoped that the quality of
advice given to participants in the superannuation industry by financial
planners and advisers will improve."
He continued, "But it is impossible to believe that existing problems in
the industry and the wider investment industry will be resolved in the absence
of substantial reforms and a greater insistence on higher professional and
ethical standards by all those who participate in the corporate world and the
financial services industry."
Put another way, with financial markets in turmoil and clients
predominantly reluctant to invest, now is an important time for all financial
planners to be thinking carefully about how to run their business. While the
new world brings new challenges, it also brings new opportunities.
The silver lining is that today's difficult trading conditions will enable
planners to stress test their business model. A good business will
continue to grow in good and bad times even if the growth curve may not be as
steep during the lean years.
Some businesses even use the bad times to recognise their operational
weaknesses and adjust accordingly.
Perhaps advisers who have seen their recurring revenue fall by 30 per cent
or more over the last twelve months might now acknowledge that having revenue
substantially based on market performance makes them more vulnerable than
necessary during down cycles.
It is against this market backdrop that we produce this edition of the
Journal, which addresses highly topical subjects in all areas of a financial
planner's practice. We are confident that you will find this edition practical
and useful in an environment that a famous Chinese proverb would describe as
living in interesting times.
As always, Financial Standard and the Rainmaker Group want to make
this publication an integral part of industry debate and encourage a robust
exchange of ideas in the financial planning and advice community.
Your feedback and suggestions for topics to be researched and presented here
are most welcome.
