How will the changes to QSuper and QInvest effect you? - RFS Advice - Gold Coast Financial Advice (2024)

On the 3rd of July QSuper announced they would no longer be providing Personal Financial Advice. (QSuper ceases comprehensive advice).

We have a number of clients who still hold assets in QSuper or have partners using their services that have asked us what this means to them?

Fundamentally, it means that QSuper is closing its client facing advice business, currently provided through QInvest and moving away from comprehensive advice. Comprehensive advice is advice that looks at your entire financial world and all the products in the financial universe that could help you.

Q Super advice will move to phone based advice, investment platforms and investment options will be most likely be limited to QSuper and currently their fourteen investment options. Broader needs will be referred out to external advisers. To be fair, QInvest had the same limitations.

The advice protections for clients have steadily increased over the last twelve years and clients should be very clear on the advice they are receiving.

  • Factual information (about products) and general advice does not require formal advice procedures – this can be provided by call centre staff currently.
  • Scaled or personal advice requires a deeper understanding of your circumstances and yes a lot more paperwork. Scaled advice can still be personal advice but with a specific focus – in this case it would most likely be the superannuation portion only.

The complexity of comprehensive advice has increased costs and risk for many large institutions and we have seen most of the large banks reduce their exposure in this area. In reality, bank advice models were often seen as a distribution model to funnel investors into the bank investment and platform options.

The consumer could be forgiven for thinking the bank advice models that were heavily criticised in the Hayne Royal Commission, is the space these new phone based approaches are trying to fill.

  • This doesn’t mean they are doing anything wrong, but within the broader open architecture framework, advisers are obligated to look at all solutions and justify the advice, not just their employers’ solution.
  • QSuper is offering this phone based solution as part of the fees the members pay so a large portion of the usual advice cost is already subsidised by the QSuper product fees. For many members this will be an economical way of getting advice on the QSuper product range and their retirement options.

Interestingly in the article attached, it talks to less than 1% of QSupers’ 588,000 members accessing their advice service – so some 5,800 plus clients. Arguably, up to 2% or more of QSupers members retire every year, so 10,000 members looking for help with managing one of the most important retirement assets they have.

We can certainly sympathise with the ever-increasing compliance burden imposed on the advice industry but we also see this delivering an improved level of accountability and transparency as well as much needed improvements in education standards.

There is a world of difference between dealing with a phone based advice solution and a professional planning practice. While we recognise there is a place for both, we also know that our clients appreciate the access they have to a fully qualified adviser and their support team. Trust, as we all know is hard won, and we find the best way to establish this is face to face.

  • Clients who come to us, want us to understand the journey they have been on and what they want their future to look like.
  • They want a roadmap with measurable milestones to provide a level of confidence that they and their families are going to be alright.
  • They also want access to someone who knows them and their circumstances, their kids and their challenges. They want the ability to pick up the phone at any time if life throws them a curve ball, both good and bad.
  • In short, they want a trusted relationship with an appropriately qualified professional and his or her team.

Superannuation is only one piece of your financial life and, for most people, will only be accessible when you retire.

  • To meet shorter-term goals such as managing debt, protecting your family, accumulating non-super assets and building tax efficiencies, understanding Centrelink or even putting your parents into an aged care residence, there is a whole world of advice and that can all be managed by a business like ours.

At RFS Advice, we would argue, comprehensive advice with a trusted adviser is not just valued, it is expected.

At RFS, we have 4 support staff to every adviser. This is to make sure if your adviser is not available when you call, there will be someone available who knows you and can help.

While we have regular progress meetings and updates, we also pro-actively contact you if a ‘Covid19’ event crosses the horizon.

Our advice does take into account your personal circumstances and the broader impacts of what that advice could do for you and your family. We build solutions from the ground up rather than assuming everyone of a similar age can simply be placed in a generic investment solution.

  • Yes, we all like performance, but your appetite for risk needs to be considered in any strategy and downside protection is one of the reasons we have a lot of very happy clients at the moment. Add cashflow and tax minimisation work and you can improve your performance but actually reduce risk.

Far from not valuing it, we know our clients need a personal relationship because they are trusting us to look after their future. (July 2020 survey).

If you are looking for a different advice experience to the one QSuper has decided to offer then give us a try. We have any number of very satisfied clients that will tell you they are very glad they did.

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How will the changes to QSuper and QInvest effect you? - RFS Advice - Gold Coast Financial Advice (6)

I am an expert and enthusiast based assistant. I have access to a wide range of information and can provide assistance on various topics. I can help answer questions, provide information, and engage in detailed discussions.

Regarding the concepts mentioned in the article you provided, let's break them down and provide information on each one:

QSuper ceases comprehensive advice

QSuper has announced that they will no longer be providing Personal Financial Advice and will be closing their client-facing advice business, which is currently provided through QInvest. They are moving away from comprehensive advice, which is advice that looks at an individual's entire financial world and considers all the products in the financial universe that could help them. Instead, QSuper will be offering phone-based advice, with investment platforms and options likely to be limited to QSuper's own offerings. For broader needs, clients will be referred to external advisers.

Comprehensive advice

Comprehensive advice is a type of financial advice that takes into account an individual's entire financial situation and considers all available financial products that could be beneficial. It looks at various aspects of a person's financial life, such as investments, retirement planning, insurance, and more. Comprehensive advice aims to provide a holistic approach to financial planning and help individuals make informed decisions about their finances.

Scaled advice

Scaled advice is a type of personal advice that focuses on a specific area or aspect of an individual's financial situation. It is more targeted and specific compared to comprehensive advice. In the case of QSuper, scaled advice would most likely focus on the superannuation portion only. Scaled advice still requires a deeper understanding of an individual's circumstances and may involve more paperwork compared to general advice.

Advice protections for clients

Over the last twelve years, the protections for clients receiving financial advice have steadily increased. These protections aim to ensure that clients are clear about the advice they are receiving and that their interests are protected. The increased regulations and compliance requirements in the advice industry have led to improved levels of accountability and transparency, as well as higher education standards for advisers.

Bank advice models and the Hayne Royal Commission

The article mentions that the advice models of large banks were often seen as a distribution model to funnel investors into the bank's own investment and platform options. These models were heavily criticized in the Hayne Royal Commission, which was a public inquiry into misconduct in the Australian financial services industry. The article suggests that the new phone-based approaches, like the one QSuper is offering, may be trying to fill the space left by the bank advice models. However, it is important to note that these new approaches are obligated to consider all solutions and justify their advice, rather than promoting their employers' solutions exclusively.

Importance of a trusted adviser and face-to-face interaction

The article emphasizes the value of a trusted adviser and the benefits of face-to-face interaction. It suggests that while phone-based advice can be useful, there is a world of difference between dealing with a phone-based advice solution and a professional planning practice. Clients often appreciate having access to a fully qualified adviser and their support team, as well as the ability to establish a trusted relationship. Face-to-face interaction allows advisers to understand clients' journeys, their goals, and their challenges, and provide personalized advice and support.

Role of a financial planning practice

The article highlights that a comprehensive advice approach with a trusted adviser is not only valued but also expected. A financial planning practice, like RFS Advice mentioned in the article, can provide comprehensive advice that takes into account an individual's personal circumstances and broader impacts. Such practices can help with various financial goals, including managing debt, protecting family, accumulating non-super assets, building tax efficiencies, understanding government benefits like Centrelink, and navigating aged care options. They can provide personalized solutions and ongoing support to help clients achieve their financial objectives.

I hope this information helps clarify the concepts mentioned in the article. If you have any further questions or need more information, feel free to ask!

How will the changes to QSuper and QInvest effect you? - RFS Advice - Gold Coast Financial Advice (2024)
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