A significant majority of Australians believe financial advice is essential and support the idea of accessing superannuation funds to cover the costs of using an adviser, according to research conducted by a wealth management firm.
Colonial First State’s “The Empowered Australian Report 2023” found 93 per cent of over 2000 survey participants felt Australians required financial advice, with over half (52 per cent) stating it would most benefit those who were struggling financially.
In response to the question of using superannuation funds to pay for a retirement plan, 61 per cent of participants expressed interest, with the strongest support observed among men aged 25-29 (76 per cent) and women in the same age range (70 per cent), as well as those who currently have a financial adviser (74 per cent).
Colonial First State Superannuation chief executive Kelly Power noted the analysis indicates the decision to adopt recommendation 7 from the Quality of Advice Review, which allows advice to be paid for from super, is a prudent move, with Treasury last month confirming it was preparing draft legislation to facilitate the measure.
“Financial advisers and the customers they support will benefit from greater clarity around how people can use their super to pay for advice,” Power said.
“Many Australians still don’t know that the cost of advice can be deducted from their super account. At a time when many Australians are struggling with the cost of living yet are in need of advice, having a clear list of advice topics that can be paid for with super represents an important development.”
She proposed tapping into superannuation funds to cover costs could help bridge the advice gap, pointing to Investment Trends research that indicated a 25 per cent increase in the costs of financial advice over the past year.
“There is a common misconception that financial advice is for the wealthy because it is unaffordable. Yet our research shows that advised and unadvised Australians largely agree that it is those who are struggling financially who need advice the most,” she said.
“We welcome the government’s decision to broaden the list of advice topics that can be paid for with super.”
The study analysed the responses of 2247 Australians aged over 18 between July and September 2023, with a subset of 456 respondents already using the services of a financial adviser.