The Evolving Advice Landscape
Advice Entrepreneurship in Action
I don’t understand all the technical information, which makes me feel like I’m abnormal or inadequate. I’m eager to learn more, but I feel excluded and like I haven’t learned anything.
Why can’t they talk in language normal people can understand, like those finfluencers?
The language we use is dictated by our legal and compliance teams and product providers. Besides, it helps reinforce my professional expertise in a complex area.
The customer doesn’t need to understand this stuff, my role is to hold their hand through everything.
Finfluencers are a problem, I hope they are legislated out of existence.
In recent years, ‘finfluencers’ have found a wide audience on social media channels such as TikTok, YouTube, Facebook and Instagram where they offer a wide range of finance and investment tips. As they grow in popularity, ASIC is now focussing on the discussion of financial products and services online.
The popularity of videos and other posts on these topics is indeed phenomenal. As of April 2022, for instance, the hashtag #FinTok has attracted around 1 billion video views on Tiktok globally, while #stocktok has over 2 billion, #cryptocurrency over 5 billion and #crypto over 14 billion.
Closer to home, Sydney-based finfluencer Queenie Tan’s posts have gained her more than 36,000 followers on Instagram. Her TikTok videos explaining Australian tax rules for cryptocurrency capital gains and offering tips for first home buyers have each been viewed more than 400,000 times, and both last less than a minute.
Notwithstanding issues around legality, younger consumers are attracted to finfluencers because they use this group’s preferred social channels. And because finfluencers are generally young themselves, they talk the same easy-to-understand language and can break down complex topics into bite-sized chunks that are both digestible and relatable.
While many advisers think of Millennials and Gen Zeros as the clients of the future, these cohorts clearly have a desire to improve their financial knowledge now, so they can put the foundations in place to build a secure future.
And there’s a lesson here for all advisers.
Recognising the appetite of younger clients for financial education, and the power of online communities, Adele Martin of Firefly Wealth (Firefly Wealth Pty Ltd, ABN 30 818 437 055) has built an offering built around education and general advice only called My Money Buddy. Where clients need personal advice, she refers them on.
Described by the Australian Financial Review as “the F45 equivalent for financial advice, charting a middle course between the DIY and the premium route of one-on-one”18, My Money Buddy is a subscription-based program of tools, support, and community.
This approach has proven especially popular with younger Australians.
“While many people talk about the younger generations as the clients of the future, what we are seeing is a significant and widespread appetite for education on financial matters right now,” Martin says.
Delivered live online (with recordings available on demand), the My Money Buddy program comprises six modules delivered over a six-week period:
Among the practical tools Martin offers through the program are a series of negotiation scripts, which her clients can use to negotiate everything from a salary increase (one of her most popular) to a cheaper power bill.
The community of program participants is also central to its success. Within a closed Facebook group, members share their goals and success stories. So powerful are her negotiation scripts and savings tips that most members usually achieve significant savings in a short period of time.
“This gives them the enthusiasm and momentum to keep going and many go on to seek one on one advice”, says Martin.
Martin also offers an online personal money coaching program as well as a free podcast with its own community: The Savings Squad.
Using the Kajabi e-learning platform, Martin finds that online and video-based resources are not only more convenient and more aligned to the way younger clients want to engage, but they also bring significant efficiency savings, allowing her to sustainably offer her services at an affordable price. Her My Money Buddy program, for example, costs participants as little as $1,500.
“My programs are getting a younger generation ‘advice ready’, allowing them to gain confidence and trust in the process and outcomes of expert help,” says Martin. “This improves the client onboarding experience as clients can set their own goals, create a budget, and learn about concepts such as risk profiling at a time convenient to them. Instead of an adviser explaining everything over and over, a concept like this could be used in a traditional advice business to save advisers time and give younger clients the experience they’re after.”
Martin says she’s been signing between one and four clients a week to the program – even while on maternity leave and during COVID lockdowns, and with very little marketing. And while $1,500 per participant is well below the $5,000 to $7,000 she would charge clients for comprehensive advice; her overheads are far reduced for things like administration and paraplanning.
“At its scaled model, this is profitable,” she said.
Not only does the My Money Buddy program support clients in their early stages of the advice process, it has also had benefited Martin herself after the industry challenges of recent years.
“I think what’s it done more than anything is let me breathe and enjoy advice again,” Martin said.
‘How the virus inspired the F45 of financial advice’, Australian Financial Review, 9 April 2020.
Innovation isn’t new but the way these advice entrepreneurs look at common challenges provides fresh perspectives on the way they do business. By shifting their focus to the client and approaching key facets of advice in innovative ways, they are making their business more efficient while driving better client outcomes.
At HUB24, we believe in the value of advice and are committed to innovation that creates better outcomes for the industry. By leveraging data and technology, and collaborating with industry participants, we are helping to solve key advice challenges and make advice accessible to more Australians.