Financial advice

Australians are generally reluctant to seek professional financial advice, despite the financial landscape (including the retirement system) becoming increasingly complex. The right financial advice can help you to get the most out of your superannuation.

A person or organisation providing financial advice in Australia must hold an Australian Financial Services Licence issued by the Australian Securities and Investments Commission (ASIC), or they must be the authorised representative of a licence holder.

Financial advisers have a legal obligation to act in the best interests of their clients. However, the industry has been tarnished by the actions of some individuals and organisations in recent years. The Financial Services Royal Commission made a range of recommendations that if adopted will help to restore consumer confidence in the financial advice industry.

It’s important to know whether any financial advice you receive is independent or not. Advisers are legally required to provide you with a financial services guide that will let you know this information. Independent financial advice can be broadly defined as advice that is impartial or unbiased. It is provided without any potential for a conflict of interest.

Examples of financial advice that is not independent includes that provided by advisers who:

• receive a commission (or any other gift or benefit) for recommending specific products and services issued by a financial provider.
• receive remuneration based on the volume of business they place with the issuer of a financial product or service.
• work on behalf a specific financial organisation and are therefore limited to recommending that organisation’s products or services.

For more information on obtaining financial advice, see the following SuperGuide articles.