Nick Dignam from Fortitude Investment Partners shares insights with Lachlan Maddock from Fortitude Investment Partners on how a diversified portfolio in mid-market private equity is structured. The Inside Adviser
The world of alternative investments is at a crossroads. As markets defy expectations and liquidity concerns take centre stage, investors find themselves forced to rethink how they deploy capital in an increasingly complex environment.
‘Tale of two halves’ for advice industry showing signs of new growth
History could show that mid-2024 was the nadir of the adviser exodus, the point when adviser numbers finally bottomed out at around 15,500 and began a slow, hard-fought recovery.
Wealthdata records show the net change for adviser numbers was -143 in the calender year 2024, with 35 advisers exiting ASIC’s Financial Adviser Registry in the last week of December. There were 15,623 advisers at the start of 2024 and 15,480 by the end of the year.
Drill deeper into the numbers, however, and the picture becomes much less negative. While 143 adviser left over the course of the year, the financial year-to-date figures show of +139 show a stark turnaround in adviser numbers, which means that at some point over the course of the year adviser numbers stopped going down and started going up.
Further, while the industry lost 143 advisers over the course of 2024, this was an improvement on 2023, when 181 advisers left the industry.
“To steal a phrase from every football coach, it has been a tale of two halves,” commented Wealthdata founder Colin Williams. “Calendar YTD is still in the red, but the financial year is looking very strong. Both sets of data for 2024 has been better than 2023.”
The pipeline for new entrances into the advice profession also bulked up over the year. Wealthdata reports that 505 new advisers came onto the FAR, with 476 remaining current by the end of the year. “This compares very well to 2023, which saw 408 commence and 366 stay current,” Williams noted.
Long recovery
The pace of change is slow, however, and challenges in significantly increasing the number of new entrants entering the advice profession remain. In mid-December, three universities (University of Tasmania, University of Wollongong and Queensland University of Technology) announced they would cease to offer their approved financial planning courses.
Such is the urgency to get new advisers into the profession, the Financial Planning Association of Australia (FAAA) added ‘growth’ to its list of strategic objectives for the next four years.
“We’re all very aware that our numbers have declined very substantially,” FAAA chief executive Sarah Abood said at the association’s national conference in October.
“We’re down, I think, 46 per cent now from our from our top in 2019 when it peaked, and we know that there are nowhere near enough advisers to serve existing demand. We really need to grow again the numbers of professional financial advisers, and that’s what’s needed in order to allow more Australians to have access to that service.”
While the national university system might not have the funnel width the industry needs to replenish resources, the FAAA is keen on tapping into international sources of talent. At its conference the association announced a strategic partnership between advice communities in India and Australia to promote “cross-border mobility and professional development” for holders of the Certified Financial Planner designation.
“That’s an area where clearly there are a lot of financial planners and a lot of students,” Abood said. “We also have such a strong community with Indian heritage here in Australia – if we’re able to free up cross-border education and opportunities for people who might be practicing or thinking about studying in India to come to Australia, we think that’s one way we can really help drive the pipeline.”
