Yahoo Finance Female financial planners wanted: New FPA boss Sarah Abood's goals for the industry
Early this year, Sarah Abood stepped into the role as CEO of the Financial Planning Association of Australia (FPA), and she has big plans for the industry.
After much change in the sector, due to the banking royal commission, Abood - who comes with 25 years’ experience in financial services - hopes to change the perception, and build a network, of financial planners.
She also aims to bring more female financial planners into the industry.
“The industry has come through huge changes over the past couple of years,” Abood said.
“The outcome of the royal commission led to massive amounts of change in the regulation, with regard to the education requirements for planners, as well as the structure of this profession.”
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The industry’s transformation saw notable changes, including a number of the large licensees deciding to exit the wealth area altogether.
“These include some of the big banks that have stopped offering financial advice, with the exception of some limited high-net-worth offerings,” Abood said.
“A lot of financial planners have moved to smaller licensee groups, and these are growing.”
As a result, many planners are keen to run their own show and become self sufficient and have more control over their own destiny. This move means that planners are becoming largely business operators as well as professionals.
“We advocate for the profession; consumers have to recognise that things are changing in this profession. We offer our members more support on the business-management front as well as on the professional front.
“This is key in the way the FPA is changing.”
Abood likens the change to the roles of a GP.
“Many GPs have many professional obligations, but they’re also running a business. The financial planning profession is starting to look like that,” she said.
Financial planners must now adhere to ongoing tertiary education requirements to practise.
“There’s been a huge amount of change in regulation, for planners to keep up with,” Abood said.
“Education requirements have increased and changed rapidly. We have to help them in that change.
“The difference is now they’re requiring tertiary qualifications, specifically in financial planning.”
Building future female planners
To encourage women into the practice, The FPA has a scholarship program for women, which is part of the Women’s Leadership and Development Program, in conjunction with the Department of the Prime Minister and Cabinet’s Office for Women.
These are aimed at assisting women to enter, re-enter and achieve leadership roles in financial planning, accounting, business, finance and economics.
“We’ve had a lot of demand for the scholarship,” Abood said.
“We’re seeing more women coming into the profession, and we’ve formalised scholarship programs worth almost $1million, with more opening up all the time.
“Also, we run a successful mentoring program for women in our profession.”
In terms of statistics on representation, women make up approximately one quarter of all financial planners. Seventy-five per cent of the FPA’s female members are aged under 51 years.
Interestingly, women are also more likely to be studying to meet the professional standards: 32 per cent of women, compared with just under 20 per cent of men.
Women need to get smarter
Many women today are actively taking a role in decision making when they’re in partnership as well as seeking advice as individuals.
What riles Abood is when women are treated as somewhat lesser when in a couple.
“There is a school of thought now that partners and/or couples should be treated as separate clients,” Abood said.
“We know relationships break down. People should plan as an individual and not as a couple.
“I’d like to see more women doing this; not just being part of a couple or following a male partner.”
Abood believes many women seek advice around relationship triggers, such as getting a divorce, when it could be too late.
“I would like to see women seeking out that advice towards the start of their career, as an individual,” she said.
“If they’re partnered, that’s fantastic, but this shouldn’t stop them seeking advice for their own circumstance. This is something I am passionate about.
“Women suffer from a double whammy. They earn less and very few employers pay super when women take time off for child rearing, so women retire with less.
“This has to be addressed as an industry. We need big ideas on this front to change it.”
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