Getting financial advice? What your adviser needs to provide

We all make personal financial decisions every day, whether it’s about household spending, the mortgage we select, or how much we can afford to contribute to our super.

Yet basic financial literacy in Australia has been in decline. Surveys suggest around 45% of adults are financially illiterate.

Vanguard’s How Australia Retires 2025 report found many people struggle to understand basic concepts like interest, inflation and the importance of diversification in managing risk.

So, with many Australians feeling financially squeezed, it’s surprising more of us don’t seek help from an expert like a professional financial adviser.

The AMP 2024 Financial Wellness Report found just 34% of Australians feel financially secure, with 29% of respondents saying they feel moderately or severely financially stressed. Among the financially stressed group, only 13% had sought assistance from a financial adviser, with 35% not seeking any advice or support at all when making important financial decisions.

Understanding the different types of financial advice

If you haven’t had any contact with a financial adviser before, then the process of finding one to speak to can seem a little daunting.

So it’s reassuring to know there are strict rules covering the documents and information your adviser must provide and that they must be working in your best interests.

Financial advice is divided into two main categories:

1. General advice

This type of financial advice is quite broad in nature. It doesn’t take into account your personal objectives, personal financial situation or needs.

The adviser can tell you about the features of a financial product (such as investments, super or insurance), but not about whether it’s suitable for your personal circumstances.

If an adviser is giving general advice, they don’t need to provide you with a Statement of Advice (SOA) and there is normally no fee payable.

2. Personal advice

If you want financial advice that considers your personal goals, needs and financial circumstances, you can choose either:

• Limited or single-issue advice: Covers a particular issue and doesn’t take into account your full financial situation.
• Scaled advice: Covers your overall financial situation and can be scaled up or down depending on your particular requirements and situation.

When an adviser provides personal advice, they must give you an SOA, Financial Services Guide (FSG) and PDS.