Future of Financial Planning. Wessel Oosthuizen CFP FPSA

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1 Future of Financial Planning Wessel Oosthuizen CFP FPSA

2 The Future of Financial Planning I. Financial Planning The current picture II. Who or what can have an impact on the future of financial planning? III. Financial Planning The future picture IV. Conclusion 10/20/2018 2

3 Financial planning is mostly about the future 10/20/2018 3

4 Financial Planning the Current Picture - I Financial Planning is the process of developing strategies to help people manage their financial affairs to meet life goals. (definition FPSB) 10/20/2018 4

5 Financial Planning the Current Picture - I The DNA of Financial Planning help people The first Fais Ombud, Charles Pillai, emphasised that instead of worrying about compliance, advisors should worry about their clients. If they looked after their clients, compliance wouldn t be an issue. 10/20/2018 5

6 Financial Planning the Current Picture - I Reality Financial Product Salesman They sell a product - no advice Financial Advisor Financial Product Advisor product is key Financial Advisor product is key Financial Planner financial plan with solutions is key o Financial Planner and Holistic Financial Planner Fintech Financial Advisor technology is key Robo advice and Digital Financial Planner 10/20/2018 6

7 Financial Planning the Current Picture - I Regulated Current Financial Services Provider with categories according to product Financial planner not defined Future proposals Product Supplier Agent - PSA (tied advice) Registered Financial Advisor - RFA (non-tied advice) Financial Planner will not be a separate license category but the words financial planner and financial planning will be reserved for people meeting prescribed professional body criteria 10/20/2018 7

8 Who or what can have an impact on the future of financial planning? - II

9 Generations Longevity Value What is your most important asset as financial advisor Client? Migration & Ethnicity bias Regulator Technology & Information Knowledge 10/20/2018 9

10 Workforce Inefficiencies & Charging models Changing Consumer Behaviour Increasing Competition Economy, Politics & Environmental Financial Advisor Emerging Technologies Increasing, Complex and Stringent Regulations & Security 10/20/

11 Who or what can have an impact on the future? You Heart Mind Hands Technology & Artificial Intelligence Generations Longevity Regulator Technology & Information Knowledge & Skills Value 10/20/

12 Who or what can have an impact on the future? You Heart Mind Hands Technology & Artificial Intelligence Changing Consumer Behaviour Increasing, Complex and Stringent Regulations & Security Workforce Inefficiencies & Charging models Increasing Competition Economy, Politics & Environmental 10/20/ Emerging Technologies

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14 The Future of Financial Planning- III How to make sure YOU are future proof Be more human, more holistic in your advice approach and upskill yourself for the future Remember you cannot compete with Robots but they can also not compete with you - yet

15 The Future of Financial Planning- III How to make sure YOU are future proof Be more Human It is about looking at the big picture and trying to incorporate wisdom, along with emotions, as we see the springing up of behavioural economics and why we do what we do. It becomes really critical to try and take health, wellness, happiness, human capital, emotions, relations, and wealth together as they are all part of the playing field.

16 The Future of Financial Planning- III How to make sure YOU are future proof Be more holistic in your approach Psychological Portfolio Social Portfolio Holistic Advice Health Portfolio Financial Portfolio Source: Dr Hannetjie van Zyl-Edeling

17 The Future of Financial Planning- III How to make sure YOU are future proof Upskill yourself Source: American Management Association (AMA) Critical Skills Surveys

18 The Future of Financial Planning- III How to make sure YOU are future proof Upskill yourself 1. Complex problem solving 2. Critical thinking 3. Creativity 4. People Management 5. Coordinating with others 6. Emotional Intelligence 7. Judgement and Decision making 8. Service Orientation 9. Negotiation 10.Cognitive Flexibility Source: Future of Jobs Report, World Economic Forum

19 The Future of Financial Planning- III How to make sure YOU are future proof Be more trustworthy

20 How to make sure YOU are future proof - Add more value 10/20/

21 Conclusion Be more human Be more holistic in your advice approach Upskill yourself Be more trustworthy 10/20/

22 Conclusion I can see Digital financial advice experience Profit margins smaller but Greater value at lower costs Fiduciary standard Financial advice will expand in the Mass Market Segment 10/20/

23 Conclusion I cannot see Consumer demand for holistic or for fragmented advice Would generational wealth transfer still take place The evolution of and capabilities of digital advice platforms The impact of cyber-security attacks 10/20/

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25 Technology, AI and automation are rewiring the nature of our work. We will focus more on the very qualities and talents that make us human. So to succeed in the future, we ll need to embrace those abilities, seek them out when hiring, develop them as managers, and improve them as individuals. Thank you 10/20/