[The Wrap] Building a bigger moat around advice businesses
There is no doubt that the future of the financial advice sector is going though signifiant changes, thanks largely to regulatory change.
And there is little doubt many advisers are feeling angst about the future. Indeed since March when the Financial Services Legislation Amendment Act came into effect many advisers have hung up their shingle.
That's one of the things about advice, in the past barriers to entry were low to non-existent and pretty much anyone could hang up a shingle and call themselves a financial adviser. It is little wonder then that many described advice as a cottage industry.
But the future looks quite different. Indeed I would suggest that instead of a low barrier to entry it will become significantly higher and that the moat around advice businesses will increase in size. (The concept of a moat is that it surrounds and protects a business from competitors).
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