Time is running out for life advisers who want to sell their practices before looming regulatory changes, Connect Financial Service Brokers CEO Paul Tynan warns.

“Life advisers don’t think things are going to change,” he told insuranceNEWS.com.au.

“The dealer groups don’t want to engage in succession planning for their advisers, because they will lose the fee income from them.”

Mr Tynan says proposals for new adviser education standards will mean a number fail to qualify, leaving them with no business.

“The dealer groups will be required to terminate their authorisations,” he said.

“And that means no income, so these older life advisers need to consider their futures now.”

Mr Tynan says the financial services industry is changing at a rapid rate, but many desperately hope it will not affect them.

“The 21st century is being driven by even faster advances in technology and ‘real-time’ communications, which are changing our way of life, jobs and disrupting cultures.

“Financial services are at the forefront of these changes, with financial planning required to adhere to even higher standards of legislated education, compliance and governance to safeguard the consumer.”

Mr Tynan says this should drive succession planning, but it is not.

“Many mature-age principals of financial planning practices who should be implementing their exit succession strategies are clinging on in the vain hope sale prices will return to pre-global financial crisis levels.

“In contrast, accountants are being far more pragmatic and realistic, forming alliances with or selling their businesses to fellow local accounting practitioners.

“Or they are changing their operational models to specialise in business advice supported by alliances with financial planners, lawyers and other professionals.”