You can now get super advice for less than $100. Here’s how

Australians will now be able to access financial advice from their super fund for less than $100 after new laws were introduced, allowing funds to provide limited advice and financial education to their members.

The move follows the government’s Quality of Advice Review recommendations that super funds step in to be the primary source of financial advice for fund members.

Australians of all ages and stages of life are interested in financial advice - provided it’s not too expensive.Credit: Dominic Lorrimer

The move comes as part of the Albanese government’s first tranche of legislation to deliver its package of reforms to help close the advice gap, amid a critical shortage of financial advisers in Australia, and reduce costs.

Many advisers have fled the industry in droves after the banking royal commission in 2019 saw more regulations introduced, adding to the cost for financial advisers to provide advice without improving the outcome for those receiving it. This has led to remaining advisers hiking fees, making advice unaffordable for everyday consumers.

Most funds have been developing frameworks for triaging their members into different advice and guidance channels based on their financial situation and ability to pay.

Many plan to bridge the gap with digital tools that help provide free or cheap advice to members wanting to make financial plans for retirement. The tools will offer fund members a self-guided path to better understand how much they need to accumulate for a comfortable retirement.

Research shows that while many consumers would like to access financial advice, most aren’t willing to pay the current fees.

Super funds Colonial First State (CFS) and HostPlus have both recently launched such tools. In the case of CFS, members who use the tool will have an $88 fee deducted from their super account and can use it unlimited times in a 12-month period.

Many consumers recognise that staying on top of their super is key to growing wealth, but confusion over investment performance is preventing many from making decisions, CFS chief executive Kelly Power says.

“As an industry we need to do more to demystify super and drive engagement so that more Australians feel confident making decisions about their financial future,” Power says.

HostPlus’ new tool, SuperSmart, is described as an education-led digital tool aimed at helping members prepare for better retirement outcomes. It will be free to all members.

UniSuper has been well entrenched in the advice space, with a national team of advice professionals and a finance advice centre. The fund has also rolled out automated, triggered journeys for members that target members by age, and educational content to help them prepare for retirement.

Similarly, Insignia has launched a new advice tool, while Rest is in the process of expanding its advice tools. Aware is also building out its free advice offerings.

The cheaper advice comes as five million Australians approach retirement and need financial advice at an affordable price.

Research shows that while many consumers would like to access financial advice, most aren’t willing to pay the current fees, which Adviser Ratings shows can cost around $3960 a year.

Over the past five years, fees have risen by 58 per cent amid a continuing shortage of qualified financial planners. Inflation and rising interest rates have contributed to the rise in costs

Research from Investment Trends shows that close to four million Australians would be open to low-cost digital advice solutions, while unadvised Australians who would pay for advice are prepared to commit an average of $570 to get financial advice.

Most consumers want help creating an investment strategy, for longevity risk and to grow their superannuation.

Financial advisers are unhappy about the cost of the annual levy they are required to pay to the Australian Securities and Investments Commission, along with other industry fees to retain their license.

• Advice given in this article is general in nature and 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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