In this guide
- Quality of Advice Review (QAR) and financial advice
- 1. What to consider when selecting your adviser
- 2. What to expect from the advice process
- 3. Consulting your financial adviser
- 4. Think about what you want to achieve
- 5. Determining your risk profile
- 6. Expect a Statement of Advice (SOA)
- 7. Opting for ongoing advice
We’re all feeling financial pressure at the moment, so getting some help with your money can be smart but the idea of talking to a stranger about something as personal as your financial position can be a bit daunting.
It’s worth overcoming any misgivings because working with a qualified professional can leave you better informed about how to make the most of your financial resources and any of the tax, social security and other benefits on offer.
Good, timely financial advice can also give you a better quality of life. Research by the Financial Advice Association of Australia found 44% of people who have received professional financial advice believe it has benefited their mental health and 41% thought it benefited their family life.
So, if you do decide to get advice from a professional about your financial position and retirement plans, how does the process work and what can you expect?
Quality of Advice Review (QAR) and financial advice
In June 2023, the government released its long-awaited response to the Quality of Advice Review, which looked at the way financial advice was provided in Australia and made recommendations for reforms to the regulations covering this advice.
Key priorities for the government’s planned reforms are increasing the pool of qualified advisers to make advice easier to access, streamlining the documentation required when providing advice, and making it easier to access retirement income advice by allowing super funds to provide more information.
Legislation to implement these priorities is planned for late 2023 or early 2024.
When it comes to streamlining the required documentation for advice, this will involve replacing Statements of Advice (SOA) with a more flexible Advice Record and easing the current consent requirements (such as annual renewal of ongoing fees and the requirement for a fee disclosure statement).
In relation to super funds, the government intends to adopt the QAR’s recommendations to allow funds to expand the financial advice they can provide to members and amend the existing restrictions around fees. This is designed to allow funds to provide more personal retirement advice and information to their members.
Learn more about financial advice through your super fund.
Note: As these changes to the advice process are yet to be legislated, the following steps outline the advice process currently in place when you work with a financial adviser.
1. What to consider when selecting your adviser
Choosing a good financial adviser involves doing some research and talking to several potential candidates. Issues to consider include:
