Workplace super – opening doors for advisers

In Australia there are over two million actively trading businesses. Nearly 28,000 of these are classified as mid-market with turnover of between $10 million and $250 million. With every business required to offer a default workplace super fund there remain genuine opportunities for financial advisers to strengthen and build their practice.

New opportunities?

According to IOOF’s Head of Employer Super, Steve Black, advisers are taking a second look at opportunities in corporate super and the new remuneration structures which have been established by many super providers. However this is just a small part in the larger picture of how workplace super advice has become an integral part of many financial advice firms.

“While the appeal of a steady, regular income stream offered by modern remuneration models is understandable, the big opportunity for advisers is opening new avenues for growing a business,” Steve said.

“No matter what specialty area of advice you offer, workplace super opens the door to a whole company of potential advice clients.”

Paul Mann, General Manager of Moneywise Global, the appointed financial advisers for Flight Centre agreed, saying that, “while many of the benefits of a workplace super client base have always been there, they are getting more attention now as the commission-based compensation model disappeared.”

Scale to grow your client base

For most advisers, workplace super will be just a small part of the advice services offered. Whether you specialise in general advice, insurance, mortgage broking or something else altogether, being attached to a workplace super plan lets you become the natural point of contact for members, beyond their super needs.

“Growing a client base quickly would previously have meant buying a list of clients from another adviser, which is expensive and comes with a lot of risk” Paul added.

What’s more, meeting the members at such events as member education sessions let you promote these other areas of advice – something that is often reinforced on marketing and other super related material sent out.

A new revenue stream

Most new remuneration models provide a flat fee per member model. So for every company an adviser provides workplace super advice for, the more the adviser receives. What’s more, as those companies grow, so do the revenue and referral opportunities.

And with the average age of the financial adviser around 55, Steve Black also noted the business succession benefits offered through workplace super advice.

“Selling a business as a multiple of revenue obviously means the revenue you’re generating now, becomes a multiple of this down the track when the business is sold.”

Retention

Finally, if you are providing financial advice services to your employer clients, expanding that service to their staff will strengthen the relationship. Coupled with services the employer couldn’t provide - such as member education sessions - also makes it harder for the business client to move away. This is particularly meaningful if the company is an accounting client of an advice business.

This platform for providing advice to employees can also form part of your value proposition when being considered by new clients.

Benefits to members

Quality advice attached to a workplace super plan also gives members the best possible opportunity to achieve their retirement goals.

“Workplace super has always given us the opportunity to make a meaningful impact on the lives of our clients, to promote and grow other areas of my business, whilst still receiving a fair revenue stream for our services” Paul concluded.

Conclusion

Whether it’s stronger relationships with your business clients, access to a diverse new client base or even more referrals for your services, workplace super advice offers new and sometimes unexpected benefits for your business.

To find out more on workplace super opportunities, IOOF have produced a guide outlining a pathway to success for your business or you can contact an IOOF Relationship Manager.

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Important
The information contained in this newsletter is provided on behalf of the IOOF group of companies and is intended for financial adviser use only. It is given in good faith and has been prepared based on information that is believed to be accurate and reliable at the time of publication. Any examples are for illustration purposes only and are based on the continuance of present laws and our interpretation of them at the time.