I guess the reason for me posting this question is that I know of a few friends who have (over the past year) been to financial planners lately and in all three cases the financial planner ONLY wanted them to invest in a product that they the financial planner could make a commission on (usually a trailing commission) and my beef is that the average person out there goes to a financial planner thinkin that this person is the ONLY person to see in relation to their investment needs, whatever it is. And we know this is usually (with some exceptions) NOT the case.
Why are you so fascinated with financial planners receiving commission on the products they recommend? Do you kick up a fuss then a doctor gets a commission for prescribing drugs to his patients?
financial planners offer a service, and expect to get paid for it. They also have to pay large compliance costs which they also have to recoup from their clients. Like any business, they require a income to survive, and in the case of a financial planner, its via upfront commissions and trailing fee's. All disclosed in the statement of advise which is given to the client.
Financial planners could very easily make commissions on direct property.. and they could so via selling you a loan, which also pays a trialling commission (this is how mortgage brokers survive), and also charge you management fees when you rent it out. They could also collect part of the initial agent sale commission by referring the purchaser to the agent or builder if its off the plan.
I know there will be arguments that we as individuals should educate ourselves better about the different asset classes and who to see for what, but the Financial Planning Industry has brilliantly set itself up as a perceived "one stop shop" for creating wealth and this is just not true.
That is what irritates me
As I said before, financial planners will offer investments which are on their approved products list. They can't just recommend anything to you. There are many investments which are not within their scope to recommend, like I pointed out above might include art, stamps, coin, precious metals, collectibles, sports memorabilia and the list goes on.
When you go to a doctor, is he going to offer you every sort of treatment under the sun? Could be homeopath, Chinese medicine, conventional medicine, Bowen, or even a witch doctor? Do you get upset cause they only offer you treatment in what they are trained in? Again, its up to you to choose the type of treatment your after, and then go to the appropriate doctor concerned who offers it.