Paraplanning changes flagged with the Quality of Advice Review


The Quality of Advice Review (QAR) is recommending the removal of statements of advice (SOAs). Many paraplanning professionals have shown a concern for their future job prospects, given SOAs cover a large part of a Paraplanner’s work.

Despite paraplanner fears, many leaders in the financial planning space feel that the future couldn’t be brighter for paraplanning professionals. New opportunities will arise for paraplanners that will allow them to use their skillset in different ways other than working on SOAs. Even if SOAs as they are currently known are removed, there will still be a need to organize detailed information in written form for clients. The removal of ‘template’ SOA structures and restrictions may mean good paraplanning firms will be able to differentiate further, establishing greater value-add with their ability to articulate complex information concisely. A good paraplanning firm will also ensure their documentation offers an Advisor appropriate protection, without the need for excessive legal language.

Besides generally reducing costs, part of the reason SOAs may be removed is that many clients don’t find enough value in reading through an SOA. SOA documents have traditionally been long-winded documents with a one-size-fits-all templated approach. Some people may prefer simply to talk through and understand the advice they are getting and why it would benefit them. If this can be done without a long SOA involved, then the QAR feels that financial planners should be able to.

If the removal of SOA requirements takes effect, in-depth consideration of what needs to be on record for the client will need to take place. How the new information is presented to the client will also need to be considered. Advisors will need to be properly trained on both of these new protocols, as this will make sure that they are able to provide effective and clear advice without the SOA.

While the removal of SOAs could lead to significant changes to the daily role of a paraplanner, they shouldn’t fear the change. They will only become a more critical role in supporting Australians’ access to quality financial advice. As paraplanning moves away from the more clerical duties they’ve focused on, the roles that these professionals will hold in the future is still somewhat unclear. Paraplanners may take on more advanced roles and support higher levels of planning and analysis, relying more on their expertise in financial strategy and crafting insightful, concise, and tailored documents.

At Mutual Paraplanning Services, we have been helping advisers to formulate strategies for their valued clients since 2016. We analyze a client’s situation with financial advisers, demonstrate the outcome of financial modelling and discuss it with advisers to ensure clients pass the ‘better position’ test. Please feel free to reach out and find out how we work with financial planners.