Better financial advice is a Christmas gift for all – especially retirees

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The government announced a Christmas gift for all Australians with their intention to make financial advice more accessible. Minister for Financial Services, Stephen Jones introduced a set of changes on Thursday, and while it’s not yet law, it smells positive for everyday Aussies, especially those preparing for retirement.

There’s lots of talk about what it means for the industry, but little about what it really means for everyday Australians – those who need advice, many of whom can’t afford to pay off their credit cards next month, let alone fork out $4000 – the average price paid for independent financial advice today.

New rules for the financial planning sector will help Australians navigate what was previously a confusing system.Credit: Simon Letch

But first let’s start with the back-story. The banking royal commission in 2019 fundamentally changed the way financial advisers provide their services. It used to be all about guiding people to invest into financial products, with financial advisers incentivised on trailing or lump sum commissions on products sold.

But all this changed when the Royal Commission put an end to commissions being paid to financial advisers. Consequently, advisers shifted to a fee-for-service model, and much work was done to turn advice into a profession. Many advisers decided it was too hard to meet these standards, leaving the sector with only around 16,000 to serve over 5 million Australians approaching retirement. You don’t need a team of government advisers to know that’s going to be a problem.

The package announced proposes a new two-tiered advice model to lure advisers back into the industry. The changes introduce a lower class of adviser, a “qualified adviser”, trained to a diploma level and prohibited from charging fees or receiving commissions.

These advisers will be employed by super funds, banks and financial institutions who will take professional responsibility for their advice. Simultaneously, compliance obligations for professional advisers will be simplified, maintaining a focus on serving the best interests of customers.

There’s no doubt that the proposal will frustrate professional advisers, who have worked hard to reshape their industry over the last five years.

”We expect that the streamlining of the advice documentation along with appropriate safeguards will lead to improved access to advice, so more Australians can face the future with confidence,” said Jen Harding, the general manager of advice development at HESTA.

Another big change is allowing superannuation funds to provide helpful nudges to members to drive greater engagement with superannuation at key life stages. Many will use AI and data to nudge people about real time needs, something which has not been allowed before.

While a positive step, it may take about a year for the proposal to become legislation and a couple more to attract people back into the industry and train them to appropriate levels.

So what should you do if you are approaching retirement and want financial advice in the next year or so? In my view, Australians approaching retirement should reconsider the notion that everyone needs independent financial advice and view advice as a layered process, seeking different types of advice for various purposes based on their financial sophistication.

Many are unaware they can already access free advice from their super funds and great tools online – and this will only improve from here. Let’s explore the available advice options and consider how they might change.


Everyone should start with self-help, the simplest of which is available on the government’s Moneysmart website, offering basic financial literacy information and helpful calculators, and in books and courses. Super funds also provide retirement planning calculators and budgeting tools on their member websites.

And for those willing to pay, digital advice platforms like Otivo help you gather all your financial information and offer comprehensive financial plans without a need for human interaction. This area won’t change. Digital advice and self-help will grow as the tools are improved.

General advice

General advice is factual information, not tailored to personal situations. It is usually provided by superannuation call centres and workplace superannuation advisers. You might prefer to call this useful help that will explain how things work. The people who provide it typically hold a simple qualification in financial product advice.

It is a great way for people to start learning and exploring the contributions they can make, their investment options, the age pension and how their super plays a role in income layering. This area is also unlikely to change much, but may morph into the new layer called ‘qualified advice’ over time.

Intra-fund advice

Then, we jump to personal advice that takes in your actual financial situation. Intra fund advice, is a type of simple, non-ongoing personal financial advice that is offered by professionally qualified superannuation fund advisers, but their scope is limited by ASIC to advising on their investment in superannuation within their fund.

It usually allows members to review their investment choices, insurances held within their superannuation fund, get advice on contributions and preparation for retirement. Superannuation funds generally offer this as a free service, funded by member administration fees.

This type of advice will be the one that morphs more directly into the proposed qualified advice layer, which can be offered by super funds and other institutions to members for free. Under the new proposal, it can become personal financial advice that stretches beyond ‘intra-fund’, allowing standardised levels of support for many more everyday Aussies.

Comprehensive personal financial advice

At the next level is comprehensive personal financial advice which is currently only provided by professionally qualified financial advisers who are licensed and registered under the regulation of ASIC and must prioritise the client’s best interests. This can be ongoing or one-off advice. This is the home of the ‘professional adviser’ under the new proposal.

Independent financial advice is by far the most common form of comprehensive personal financial advice. There are many who provide advice and services under the professional standards of the Financial Advice Association Australia (FAAA).

But not all professional financial advisers are independent, with some superannuation funds offering this type of advice to their members that takes in more than their superannuation. Most charge a fee for this type of advice and the fee varies widely by fund.

All personal financial advisers are currently required to do a thorough and detailed information gathering and produce a detailed statement of advice for every customer they serve. These onerous statements will be replaced with a statement of advice that is in plain English and provides helpful advice to make informed decisions.

This area will likely stay ‘professional’ as a distinct fee for service offering, and, as the access to varied types of advice increases and compliance decreases, we should, in concept see a lowering in the cost of professional financial advice.

Specialist financial advice

Some financial advice firms set themselves apart by offering more specialised services. Some firms specialise in areas like stockbroking, family office wealth management, or aged care advice, requiring detailed domain knowledge. While they comply with the same rules as personal financial advisers, their expertise caters to specific problems or client needs.

There’s no doubt that the proposal will frustrate professional advisers, who have worked hard to reshape their industry over the last five years. Under this proposal, their monopoly is certainly going to be diminished, but there’s so many people in need of their services that it shouldn’t hurt their businesses too badly.

”Consumers will be left confused by the proposed term ‘qualified adviser’. This makes it very unclear what type of financial advice they are getting and from whom, and how they will pay for it. This is disappointing because a lot of work has been done recently to ensure consumers can have confidence in the advice they receive from a licensed financial planner/adviser”, said Sarah Abood, the CEO of the FAAA.

Ultimately though, this is a powerful Christmas gift for us ordinary people who need financial advice to navigate the complexity of our retirement system. Now, we need to set about using advice to help ourselves have a more epic retirement.

Have a great Christmas, see you in 2024.

Bec Wilson is the author of the bestselling book How to Have an Epic Retirement and host of the new podcast Prime Time with Bec Wilson. She writes a weekly newsletter at

  • Advice given in this article is general in nature and is not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making any financial decisions.

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