Our Adviser Profile this week is Steve Luman. Steve is a Gold Adviser with 5 client reviews and an average customer rating of 4.82 out of 5 stars. Steve is the owner and Senior Adviser of Sunlife Financial Advisory in Runaway Bay, Qld.
1. Best thing about being a financial adviser?
During the initial stages of getting to know clients,I love seeing the shift from concern and uncertainty to focused and empowered, like a huge weight has been lifted from their shoulders. Their newly found confidence allows them to feel more secure and have a brighter outlook on their financial future – I love seeing that change in attitude! I also enjoy working with them long term and seeing their plans and goals materialise – that’s a very humbling and empowering experience all in one.
2. One thing you would like to see improved or changed in the industry?
I can’t get my head around why (as a result of the Royal Commission) some of the areas that were clearly NOT in the consumer’s best interests (such as banks pushing their own products and passing it on as advice, and insurance companies cold calling with hard sell tactics) have not been adequately addressed with the consumer in mind. I can understand the recommendation to ban up-front insurance commissions (as it would be seen to deter certain insurance companies/advisers from pushing insurance products as a revenue source) BUT, I do not believe that this is the right solution for the consumer. A consumer would not want to pay an additional fee for insurance advice, meaning they would not willingly seek advice just for insurance, rather they would be forced to go direct to an insurance company who would only push their own products and not take into account the clients overall financial situation or the impact it may have on them financially. It could also lead to the consumer making ill-informed decisions (based purely on costs), and not having the time to shop around or understand the differences in policy details in order to make an informed decision based on what’s right for them. All of this could leave a consumer vulnerable at their most urgent time of need. As it currently stands, a consumer does not need to pay an additional fee for insurance advice as the adviser would be compensated by a commission paid from the insurance company (same as when a mortgage broker is paid an up-front fee from the bank). This gives the average consumer access to a financial adviser, who would play a pivotal role in determining the most cost effective, appropriate type and levels of cover as they understand the client’s overall financial situation, needs and objectives. The adviser also has access to a variety of reputable insurers and is required to provide research and alternative strategies in order to meet their compliance obligations.
I believe the more appropriate solution is to continue with the LIF remuneration rules with a 66% cap on upfront commission commencing January 2020, and a complete ban on telemarketing for insurance products that hide behind the claim of “no advice”. If you’re an insurance company and you take an enquiry from a consumer that has asked you specific questions, you are giving that consumer guidance (deemed as advice) so the same rules should apply and a statement of advice should be provided. But this will never happen because an insurance company is only pushing one product – so how is that any good for a consumer?
3. The areas on their finances or economy that worry your clients the most?
A lot of my clients worry about not being able to advance themselves financially, and not being able to pay down their debts before they retire. They are also concerned they may not have a large enough nest egg to support their lifestyle when they eventually stop working. For our 40-50 year old clients, they see the opportunity to do something now as their children are older and there is less of a financial burden, so I often get asked questions like: “Should I start salary sacrificing into my super?”; “Should I invest in property?” and “What can I do to improve our financial situation now and create wealth for our future?”. For our business clients, their number one priority is usually to reduce their tax, improve their cashflow, and start or grow their investment portfolios (whether it be property, shares or a combination thereof).
4. What's the strangest question a client has ever asked you?
I’ve never had a “strange” question from a client, I take care to listen and answer all questions honestly and in an easy to understand format because it was important enough to them to have asked the question.
5. If you could get three things into consumers' heads about what advisers do or don't do what would they be?
a) Don’t be fooled by self-proclaimed gurus selling “a quicker path to financial freedom”! It’s great to see more & more people educating themselves in finances & investments BUT, the best time to see a financial adviser is BEFORE making a financial decision, not after! I’ve helped many of my clients avoid what would otherwise have been a disastrous financial decision that could have set them back financially for years.
b) A GOOD adviser will take the time to understand you and what you want to achieve then set about putting together a series of recommendations for you to implement. The BEST of advisers will challenge your thinking, give you options to consider, mentor and empower you to ensure you understand those options before helping you to implement them, and guide you along the way to ensure you stay on track.
c) Advisers don’t have a chrystal ball and cannot predict the markets or how investments will perform in the future, but we can help our clients make informed decisions, create an investment portfolio that meets their needs, and help prevent them from making irrational or emotionally based decisions that may have a negative impact on their financial situation.
6. How do you describe your job at BBQs?
As a financial adviser, I help individuals and business owners improve their financial situation with strategies to improve cashflow, reduce tax, consolidate debt, pay off mortgages faster, and invest for their future.