The 2016 Professional Standards of Financial Advisers bill, in combination with the policies of the Financial Adviser Standards and Ethics Authority (FASEA), will change the landscape for financial planners immeasurably. One major outcome is the likely requirement for all current planners to undertake further postgraduate study.
For some planners, this will be a first foray into degree-level education. For most others, it will mean returning to study after a lengthy break. This month’s Industry Insights looks at how you can prepare yourself to undertake this study. In December we will then examine how you can succeed in your studies.
wealthdigital’s Technical Manager, Rob Lavery, also offers his insights into the challenges of returning to higher education after a significant break. Rob has just experienced this first-hand, and completed his Graduate Diploma in Financial Planning last year while working towards his Masters.
I entered the financial services industry in 2001 after what can best be described as an unfocused first attempt at university (for the record, I didn’t quite get through a Bachelor of Arts majoring in Music – although I did get to know the university bar rather well). I started studying my Diploma of Financial Services while working for a planner that specialised in insurance advice, then completed it, and my advanced diploma, after moving into the technical team at ING.
In 2014, having decided I was ready to study again, I enrolled in a Bachelor of Science by distance through UNE in Armidale. I found studying in a university environment much more engaging the second time around, although the processes and requirements of academia did come as a bit of a shock. Distance education also threw up challenges of its own, but this experience set me in good stead when it became clear in 2016 that I would need to attain higher qualifications in financial planning.
1. Where do you start?
The first thing you need to know is what further study you need to do. Until FASEA release their completed guidance for existing financial planners, there isn’t absolute certainty. That said, the draft guidance on which FASEA already consulted will give you a pretty good picture of your likely requirements. Click here to read wealthdigital’s analysis of this draft position, including a summarised flowchart.
Recognition of Prior Learning
One major factor you need to consider is whether you can gain credit in your postgraduate or undergraduate course for Recognition of Prior Learning (RPL). RPL is awarded to acknowledge formal, as well as informal, learning already undertaken in the field of study.
If you have completed courses or subjects related to financial planning, particularly at a university level, these may count in place of part, or all, of a subject. In some cases, professional experience may count as informal learning, and years in the industry may allow exemptions from certain subjects. It is worth exploring the policies of your chosen education provider to see if RPL is offered.
FASEA’s draft guidance restricts RPL to a maximum of 50% of a course’s subjects. This is broadly in line with education industry standards. It does mean that you may be able to reduce an 8-subject graduate diploma to only 4 subjects.
I was first introduced to the concept of RPL when I worked for a registered training organisation that offered the Diploma and Advanced Diploma of Financial Planning. When I commenced my study at UNE I thought it worth finding out if my previous university study would earn me RPL. It did, and after I completed the early subjects of my Graduate Diploma of Financial Planning, I also gained RPL for some of those subjects in my science degree.
The lesson I learned is that it pays to ask the question. If you have prior education that is even tangentially related to your course, it is worth making an application for RPL.
2. Deciding on an education provider
Universities and tertiary colleges aren’t foolish – they know about FASEA and the higher education standards for planners. They can see the opportunity and the number of postgraduate financial planning qualifications available in the marketplace has exploded in the past two years.
This increase in courses is a good thing for planners – more providers means more options – but it does make it harder to choose which provider with which you will study. So, how to make a choice?
Weighing up factors
There are a range of factors you will need to consider before settling on a course provider. Some of the major elements that may influence your choice are outlined below and can be researched on the education providers’ websites.
Whether it meets your regulatory requirements – As obvious as it seems, there is no point in doing a tertiary qualification if it isn’t recognised as valid by FASEA. FASEA have yet to release an official list of approved qualifications (although they have given the Financial Planning Education Council’s list as an indicative guide) yet providers have already been touting their courses as “FASEA approved”. Make sure you do your research and pick a course that will satisfy FASEA’s requirements.
Entry requirements – This may also seem obvious, but it is not much good looking to study at an education provider if you either don’t meet their course entry requirements, or you would need to complete further bridging courses to get in. If you have an Advanced Diploma of Financial Planning, or in some cases a Diploma, you will be able to get admission to a Graduate Certificate of Financial Planning. In practice, a Graduate Certificate is usually just the first 4 subjects of a Graduate Diploma and will count towards your desired qualification.
Face-to-face vs distance study – Each of these options has its benefits and its drawbacks. The flexibility of distance education is likely to sway most professionals, however it does come with compromises. There is far less personal attention provided to the learner in distance education. If you are battling to understand and interpret the text or assignments, you can usually ask questions via online forums, but you won’t have it answered instantly as you would in a classroom or lecture theatre. If you can’t self-motivate and self-manage, distance education will be a battle.
Length and frequency of study periods – Unlike diplomas and advanced diplomas, where rolling enrolments mean you can often start a subject at any time, universities and other non-vocational providers will usually have set study periods throughout the year. Different providers will have different numbers of study periods – the more study periods in a year, the more opportunities you have to complete subjects. That said, you need to be careful as not all subjects will be offered in all study periods and if a missed subject is a pre-requisite for a future subject, your studies may stall.
I chose distance study for my science degree as I struggled to find a university that offered night classes and I worked full time during the day. I was also taken by the promise of “trimesters” – with an additional study period over the summer break. In practice, this third “trimester” did not help much as it became obvious the uni struggled to get enough staff to forego their summer holidays or research time in favour of running more undergraduate subjects.
When I chose a provider for my Graduate Diploma and Masters, I went with a non-university provider who offered 6 study periods a year and each subject in multiple study periods. This has allowed me to get through more subjects in a year (while not having to do more than one at a time) and I have not been stuck waiting for a year to do a specific subject if I missed a study period.
Cost – Cost is always a major factor and the cost of postgraduate courses range wildly. Education costs that relate to your job are tax deductible so the expense may not be as immense as it first seems. If you wish to do so, it may be possible to delay paying for your course using HELP (or HECS as it was known). That said, if you are a reasonably paid, full time professional, you will probably end up repaying the cost of the subjects via your tax in the year you undertook them anyway.
Type of assessments – Whether the course is primarily assessed via exams or written assignments can be a major factor in deciding whether you wish to undertake that course. It may be that you know you get nervous in exams and would rather submit assignments. Alternatively, you may feel confident in your exam technique and would rather commit your time to studying for the exam rather than constructing an assignment response. Many course outlines will give you an idea as to how they will be assessed to help you weigh this factor.
Course content and electives – While most Graduate Diplomas and Masters of Financial Planning will have similar core subjects, what may vary is the elective subjects they offer. Many education providers will utilise subjects already used in other qualifications to bolster their available electives and this may mean that you get to study topics that are of greater interest to you. If you have a specific interest, such as portfolio management or marketing, this may influence the course in which you enrol.
Reputation – As in most aspects of life, the reputation of an education provider matters. While the hierarchy of providers when it comes to financial planning degrees is not as established as it may be in other fields, a strong reputation or the endorsement of a trusted colleague may be a determining factor when you decide on an education provider.
3. Planning to study
Once you have chosen an education provider and course, you need to determine when you will study – both in terms of a weekly plan and plotting which subjects you will do in which study periods. Under FASEA’s draft guidance, existing advisers have until January 1, 2024 to meet the new education standards. This means that there is a significant window in which to complete what looks to be, at worst, an 8-subject qualification.
The best way to plan your study timetable is to start with a broad view and drill down into specifics.
Plan your subjects
From the outset, you should work out which subjects you plan to complete to achieve your qualification. This should be combined with a determination of when, during the year, you can give the most time to study. The ebbs and flows of your business will mean that certain months of the year will see less client activity than others, and thus are better suited to study. Anecdotally, planning firms are often busiest in May, June and July as clients plan for end of financial year and execute those plans, as well as November and December, when clients are taking time to organise their affairs before taking a break.
The flipside of this is that some subjects will only be offered at certain times of the year. If a subject is compulsory and only offered during a busy time of the year, you will have a greater challenge in managing your time. Conversely, if an elective subject you are interested in is not offered at a convenient time in the year, you may need to consider doing an alternative elective.
The other factor that needs to be considered is that some subjects are pre-requisites for other subjects. In effect, this means that you can’t enrol in one subject until you have completed another. Any pre-requisite requirements will help you establish the chronological order in which you need to complete your subjects.
When I decided to return to uni to study science, I was overwhelmed by the spider’s web of pre-requisites and limitations on when subjects were offered. Not being a very committed scheduler, I took the view that the best way to avoid roadblocks was to enrol in as many first-year subjects as I could in each study period.
Attempting to complete 3 subjects in my first study period, while working full time, put immense strain on my home life and I soon realised I needed to take a smarter approach.
When the need to undertake further study in financial planning arose, I had learned my lesson and took the time to plan which subjects I would complete in each study period. I knew I had years to complete my graduate diploma and that I could afford to avoid studying in my high-workload periods of the year – such as around Budget night and the end of financial year.
Planning your weeks during a subject
Once you have determined which subjects you will undertake in which study periods, you can start to focus in on the week-to-week demands of study. A typical study period will last between 12 and 15 weeks and the subject outline should give you an indication of how many hours of study you will need to commit to the subject.
The starting point when planning a subject is to plot out the assessment due dates. These are the only dates in your study that need to be set in stone and your workload will typically spike leading into these dates.
A subject will usually be divided into sub-topics. If you are studying face-to-face, your timetable for progressing through these sub-topics is set for you and by-and-large, your baseline number of hours committed per week is also predetermined. If you are studying by distance, you will need to plan your weeks more carefully.
Some distance education providers will post lectures online on a week-by-week basis. If you view these postings in the week they are assigned, they can be good milestones for your progress through the subject. Other providers rely more on you studying written notes, in which case you will need to plot out which sub-topics you plan to study in which weeks.
Now that your weekly subtopics and hours are clear, you can allocate time on specific days in which to study. We will look at study time as two separate types – baseline hours and surge hours.
Baseline hours are those that recur each week and may include activities such as viewing recorded lectures, studying notes and researching additional materials. If you are studying face-to-face, lectures and tutorials will be allocated for you. If you are studying by distance, the challenge is greater. You may find that you study best in the office and thus your baseline hours of study are allocated at the end, or at the start, of workdays.
As you approach assessment due dates, you will need to escalate your weekly commitment to study, and these additional hours are your surge hours. Surge hours may require you to study on days not usually committed to your baseline study.
Postgraduate study is a time-intensive process and you will likely need to sacrifice some other pastimes, at least temporarily, to succeed in your studies. If you run your own business, you may have the flexibility to scale back your operations in order to free up time in which to study. This would, clearly, be a significant sacrifice and may not be practical.
If you are employed, your employer may offer study leave. While a benefit, it may only cover the amount of time needed to sit exams. You may wish to consider taking some annual leave to free up study time.
The toughest point in my return to university studies was the first month or so of my first trimester. I had never studied by distance before and it took me a few weeks to develop the discipline to sit down on set evenings each week to review the recorded lectures and make notes. Once that routine was set in place, I was away. In fact, the thing that surprised me was how lost I felt on the empty evenings that fell between study periods.
The steps required when planning for study
All the actions identified above can be summarised in 7 steps:
- Work out your course timeframe.
- Identify the subjects you need to complete.
- Identify the times of the year best suited to study.
- Using a calendar, plot the study periods during which you plan to study each subject.
- Adjust you chosen subjects / ideal study times for any subject availability limitations or pre-requisite requirements.
- Identify your weekly workload and, if necessary, plan which sub-topics you’ll undertake in which week.
- Determine the days and times on which you will undertake baseline hours and surge hours.
Watch for part 2
Keep an eye out for part 2 of this Industry Insight’s feature on higher education in early December. This second instalment will cover reading and researching, writing assignments, referencing, exam technique and managing your study expectations.