The government crackdown on SMSF lending will not burden one of the industry’s top brokers as he identifies new areas of opportunity.
Finance Made Easy owner Tony Bice – who writes SMSF loans and is also a financial planner – said he is not concerned about government changes to SMSF lending.
“There aren’t going to be too many brokers concerned with this warning until the specific restrictions are announced,” Mr Bice told The Adviser.
“I think brokers should be looking to diversify regardless of the potential changes to the SMSF lending space.”
Mr Bice’s comments come after Assistant Treasurer Josh Frydenberg flagged government restrictions on borrowing by superannuation funds this week.
Speaking at the AFR Banking & Wealth Summit 2015 on Wednesday, Mr Frydenberg said the government "did not want to see people have their retirement income savings so highly leveraged that they end up being severely damaged as a result of another financial crisis".
Mr Bice said brokers who write SMSF loans should already be looking at ways to tweak their business model in anticipation of government’s restrictions and what impact they will have on their business.
“If the restrictions are going to have a minimal impact, they might only have to tweak what they currently do,” he said.
“But if the SMSF lending restrictions will impact more than 50 per cent of a broker’s business that they write, they may have to start looking at other areas to diversify into."
Rather than wait for the restrictions to be made formal, Mr Bice said brokers should get on the front foot and act now. Diversifying into financial planning is an obvious choice, he added.
“AMP’s commission cuts that were recently announced will have a massive impact for some financial planners with regards to the amount of business they write with risk,” Mr Bice said.
“There’s an opportunity there for brokers who have or want to diversify into financial planning to buy the books off advisers who are looking to exit the industry as a result of these commission cuts.”
[Analysis: Diversify and thrive]
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