Jackie Wagstaff is principal of the financial planning and wealth management group Prescott Consultants in Adelaide. She was a founding partner of Penbroke Financial Planners. When 50% of the firm was sold to Ord Minnett, she became a director of Ord Minnett SA. Prescott Consultants was established in 2001 when Ord Minnett SA was sold to the Investor Group. Wagstaff is also on the advisory board of the Bachelor of Banking and International Finance at Flinders University.
How did you move into your area of work?
I didn’t enter the workforce until I was 30, with no skills. I worked for three years for a publishing company, then with accountants and solicitors in the late 1970s promoting tax schemes. The loopholes relating to those were closed, and I was approached by a licensed securities dealer to look at getting into financial planning.
That’s different – how has it shaped your skills?
My skills in relation to dealing with people, and men in particular, have allowed me to get on in what has been very much a man’s world. Only a small percentage of women have stayed in this industry as long as I have. It’s all about being able to play the man’s game. I guess it has given me personal skills. This is a people business. This is all about understanding people’s emotions relating to money. It’s the understanding of people and the way they think, and delivering services to them, that has helped me to be successful in this business.
Why is personal debt so high in Australia and what role should financial planners take?
I don’t know that personal debt is any higher in this country than it is in most other Western countries. It has come about because of reduced interest rates. Money has been easier to come by. As interest rates came down, the affordability of houses improved and, of course, in order to buy, people have got to borrow money. It has really been the formation of new households that has increased this borrowing level. We have seen interest rates at 40-year lows, and people feel comfortable borrowing money to buy assets. Generally, home ownership is not part of the financial planner’s brief. Everyone has to own a home; the financial planner is interested in helping people build assets outside their homes.
A report from ASIC and the Australian Consumers Association says many financial planners give poor advice, much of which is influenced by commissions.
There’s good, bad and ugly in every profession and i think it’s really refreshing to see at long last that those bad operators and ugly operators in the financial planning industry have been exposed. For too long there have been what I call “product floggers” – people that sell nothing but investments on commission and don’t disclose what they earn on them. That has to be cleaned up in this industry. There have been far too many shady operators, and it doesn’t hurt to have them exposed. Disclosure has always been a requirement in this industry but it has never been rigorously monitored. Whether it is the role of regulators or the self-regulators in the financial planning association has yet to be determined. That doesn’t mean to say that I agree totally with the way that survey was carried out. It wasn’t a particularly good survey, but if it helps clean up the industry, I’m right behind it.
Consolidation in a market the size of Australia is undeniable. What management challenges does that present for you?
The areas of compliance and the requirements of regulators are where the challenge comes for us. Also, keeping up with technology – that’s as significant an issue as any.
What are the other management challenges ahead of you?
Staff is always a challenge for management; making sure that we have the right people in the right jobs. We must also make sure that people’s passion and drive are maintained so that they are focused on building a cohesive business. Everyone who is employed in the business is part of the vision. The only way to keep that vision is by leadership and by reinforcement and encouragement to staff that this is where the business is headed – and we want them to be part of it.