Former MP on what the Kiwi financial advice industry needs

“[I want to see] key initiatives coming out of the government which raises the profile of the importance of advice and also the accessibility of that advice.”

In Shanks’ view, not enough is being done on this front, despite the returns being transformational.

“I don’t think there’s been a highlight on the difference that financial advice can make on New Zealanders,” asserted the former legislator. “There’s no doubt financial advice can transform someone’s financial health, wealth, and well-being, and I think that needs to be identified as a positive that can actually help New Zealand in the long term.

“There hasn’t been a spotlight on it before, and I think there needs to be. In other countries, they have initiatives in place which help people save for their retirement. You can get tax rebates; you can use your superannuation funds for paying for insurance… I think it’s time that financial advisers got a spotlight.”

Shanks added: “I think all governments around the world had been really focussed on the COVID response that they haven’t had any capacity to go outside their core agenda or their core promises, so I think now’s the time that they can lift their head up and go, ‘We’ve got a bit of breathing space, we’re not in a crisis mode, and we can maybe start looking at some of these initiatives which have got some true merit’.”

Public confidence and industry support

For the Financial Advice New Zealand CEO, both sides – the adviser and the consumer – should be confident in any new regime if we are to foster positive outcomes.

“My whole mantra relates to public service and making a difference to people’s lives,” Shanks, recalling the time she came onboard Financial Advice New Zealand, told Insurance Business. “And I think if we can increase New Zealanders’ financial health, wealth, and well-being, then we’re transforming people’s lives, and you can do that by quality financial advice.

“So, I was quite excited when this opportunity arose, to be able to enter into a role where you could [not only] reach out to consumers to get them to understand what financial advice is, but then also the other side of the coin where you’re working with financial advisers and driving those standards and making sure that there are quality financial advisers out there for consumers to have confidence in.”

Shanks also noted how her prior experience influenced her thinking when it comes to consumer outcomes involving financial advice.

“It’s important that we support an industry such as financial advice to ensure that they can have an environment which they can thrive in, which they can learn in, and which they can focus on delivering good services and advice to their clients,” she said.

“I saw the value of financial advice through that select committee [which I sat on in 2008] process and also saw the importance of having that framework which is strong and robust so the public can have confidence in seeking financial advice, because the two have to marry up.”

The ex-MP declared: “If there is no public confidence and trust in a regime, regardless of how good it is, no-one’s ever going to access that. So, both have to go hand in hand. You have to have a really strong framework – the legislation and the regulations – but you also have to have a vibrant advice world where they can deliver advice which is transparent, open, and well-researched to get the best outcomes for the client.”