Question: Should I become a part-time financial adviser?

Question: “I am currently in the industry, but tied to a company in selling their products.

“After almost a year in the industry, I have no doubts that I can perform and earn a decent or rather good salary. However, the thing is that, I would really prefer to do a comprehensive financial plan for consumers out there. I would like to be a financial planning professional, and NOT a GOOD salesperson.

“I understand that if I were to provide comprehensive financial planning for consumers for a fee, it may not be well received by them;as people in Singapore are receiving, 'free-advice'.

“Therefore, I am thinking of getting a full-time job, and doing financial planning on a freelance basis. Back in school(NTU), I had already completed 5 modules of CFP, and am going to finish up with the last one soon. I really have the passion for financial planning, but knowing the consumers may not be receptive, and I need to provide for the family, the whole switch to a fee-based will be a tough one for me.

“Would you be able to advise if it is possible in Singapore(legally) to provide freelance financial planning advice to consumers for a fee? I am perfectly fine having 20 new clients a year, but doing a comprehensive financial report for them.”

Answer: A good salesperson and a good financial adviser need not be a mutually exclusive. That is to say that a good salesperson can also be a good financial adviser as well. Writing a comprehensive financial report does not mean anything for a client. What's important is that the clients' goals and needs are met. I don't see why a good salesperson cannot do that. The issue with a salesperson is the temptation in recommending products that are expensive. As long as you can recommend suitable products I don't see why you should quit altogether. If you find products available for you to sell is too limiting, there are firms which carries large range of products for you to choose.

Although the regulator appears to prefer a fee-based model, but this does not automatically means consumers will benefit. Super salespersons can already sell ice to Eskimos. The same super salespersons can also rip off the same clients by overcharging them fees without the client even knowing. Don't forget that due to anti-competition law, the industry is prohibited from standardizing fees.

Generally, the regulator prefers a financial adviser to be full time. Personally, I do not think a part time financial adviser can be competent in this profession. Products, laws and services in the financial industry evolve rapidity. It is not possible for a part timer to cope with these rapid changes. The large number of advisers doing part time is itself responsible for the oversupply of financial advisers. I estimate that we should not need more than 3000 advisers but currently there are 30,000 (inclusive of the banks). In my opinion, there shouldn't be any part timers in this industry. They are doing their clients a disservice.

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