The Financial Advice Association Australia (FAAA) has expressed concerns regarding the lack of a clear pathway for paraplanners to transition to financial advisers under the proposed Australian Bureau of Statistics (ABS) classifications. In its submission to the ABS Australian and New Zealand Standard Classification of Occupations (ANZSCO), the FAAA highlighted the need for changes in defining the roles of financial advisers and paraplanners. Currently, paraplanners are not listed on the Australia and New Zealand standard occupation list, but there is a possibility of their inclusion.
Under the current ABS proposals, paraplanners would be categorized under the minor group level 531 Financial Service and Insurance Workers and major group level 5 Clerical and Administrative Workers. The FAAA emphasized that this classification could create a disconnect between paraplanners and financial advisers, as paraplanners often progress to become advisers over time.
The FAAA recommended including “related occupations” under the paraplanner classification to provide individuals with insights into potential career pathways beyond their current role. This move aims to address the potential disconnect identified between the roles of paraplanners and financial advisers, ensuring that users of the ANZSCO are well-informed about the existence of the new paraplanner occupation and its relationship with that of financial advisers.
A study conducted by the Paraplanner Hub and Tanngo, a support service platform, revealed that approximately 20% of paraplanners aspire to advance to financial adviser roles. Another concern raised by the FAAA pertains to international students using the ANZSCO, who may not be fully aware of the stringent legal requirements for becoming an adviser in Australia. The FAAA advocated for clarity in the requirements, particularly concerning education qualifications and relevant experience, to prevent misinformation that could hinder individuals from meeting the necessary criteria.
Last year, Jobs and Skills Australia identified financial investment adviser as one of the occupations in shortage in the country, indicating a demand for professionals in this field. With the number of financial advisers in Australia reaching around 15,512 as of August 31, the industry is witnessing growth and evolving dynamics that underscore the importance of defining clear pathways for career progression, including from paraplanner roles to financial adviser positions.
In conclusion, the concerns raised by the FAAA shed light on the need for a well-defined career progression pathway for paraplanners within the financial advisory sector. By addressing the classification challenges and ensuring that educational requirements are accurately reflected, the industry can better support individuals seeking to transition from paraplanning to financial advisory roles, ultimately enhancing the quality and professionalism of financial services in Australia.
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