Can financial advice be saved?

Australians collectively hold tens of trillions of dollars of assets, including property and other investments, cash deposits and superannuation.

According to the UBS Global Wealth Report 2025, Australians rank second in the world for median wealth per adult at US$268,424 (A$411,586) and fifth for average wealth per adult at US$516,640 (A$792,187).

Accompanying this wealth, however, is an astonishingly low percentage of Australians who currently receive professional financial advice.

Adviser Ratings’ 2025 Australian Financial Advice Landscape report shows that only 10.4 per cent of Australians received professional financial advice in 2025. Tapping into the other roughly 90 per cent of Australians who are unadvised remains an ongoing and increasing challenge.

The shrinking adviser pool

The number of licensed financial advisers in Australia has almost halved since late 2018, from around 28,000 to just under 15,500 in October 2025.

A significant driver for this decline has been the higher-education qualifications that became mandatory for advisers in 2017 under the government’s former Financial Adviser Standards and Ethics Authority (FASEA). This involved passing an exam and complying with ongoing professional development.

The FASEA exam was designed specifically for holistic advisers, which made compliance problematic for specialist SMSF advisers, stockbrokers and insurance advisers. 

Many financial advisers, especially those nearing retirement, also chose to exit the financial advice industry rather than complete the additional requirements. 

As part of the FASEA educational reforms, which are now under the jurisdiction of the Australian Securities and Investments Commission (ASIC), existing advisers had until 1 January 2026 to comply with a qualifications standard specified under the Corporations Act 2001.

Unless exempt, existing providers now must have completed specified courses in commercial law and taxation law to be able to provide tax (financial) advice services to retail clients on relevant financial products.

Since 2019, retail advice providers have also been required to comply with a 12-point code of ethics built around mandates such as acting in the best interests of clients, avoiding conflicts of interest and ensuring clients give informed consent. 

At the end of September 2025, ASIC reported that almost 3500 financial advisers had not yet completed the qualifications necessary to continue providing advice to clients in 2026. 

Increased complexity and compliance costs have also discouraged new entrants to the industry. Additionally, the fallout from the 2019 Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry and the exit of major banks from financial planning have further contributed to the decline in numbers.

Closing the advice gap

The demand for advice is widely expected to surge as more Australians seek out professional help to manage their wealth and estate planning needs.

David Bell, executive director of The Conexus Institute, an independent think tank focused on improving retirement outcomes, says “all the stars are aligning” in terms of advice demand.

“Demographically we have ageing populations and more people heading into retirement. We’ve got years of higher super guarantee rates, which means retirement balances are more significant for more people. Similarly, there’s the wealth effects of the property boom and intergenerational wealth transfers.

“All these things lead to wealth, and wealth creates a natural demand for financial advice.”

Getting advice costs down will be critical. The Adviser Ratings report notes that median advice fees have risen dramatically, jumping 18 per cent in 2025 to reach A$4668 — a 67 per cent increase over the past five years.

This pricing evolution reflects both the increased cost of delivering compliant advice and the shifting value proposition, as advisers focus on more complex client needs and higher-value services.

More changes ahead

Industry participants are eagerly awaiting the next tranches of the federal government’s announced Delivering Better Financial Outcomes (DBFO) package of reforms aimed at making financial advice more accessible, affordable and consumer friendly. The package is the government’s response to the recommendations of the Quality of Advice Review final report completed in 2022.

Key measures include simplifying regulations, streamlining fee consent and disclosure requirements, clarifying rules for advice fees deducted from superannuation, rationalising advice documentation, modifying the best interests duty and introducing a new class of adviser. 

Further changes are expected to expand advice channels and modernise professional standards, including the educational requirements needed to provide advice.

Also in the mix is the role of new technology solutions to help fill advice gaps, including artificial intelligence-driven tools that are likely to deliver personal and general advice to consumers. Many firms have already turned to AI solutions.

“We’re expecting more people to retire over the next few years than we’ve probably ever seen,” says Philip Anderson, general manager policy, advocacy and standards at the Financial Advice Association Australia. 

“Generally, we worry about the ability for Australians to access financial advice and we want the government to do more to ensure that it is less challenging for people to come into the profession.”

As an example, Anderson points to the current obstacles that prevent accountants from being able to transition into financial advice roles, even though they generally have financial qualifications and skill sets that should enable them to work across the advice space. He also notes that university courses catering to financial planning are also few and far between.

“The current rules state that you have to do a program that is specifically approved, but not many universities have jumped into providing financial planning education. And those that did have started to pull out because they did not get the numbers they expected,” he says.

That could change if the barriers to becoming a financial adviser are eased. As part of the DBFO reforms, there would be a new class of junior adviser with a lesser education standard who would be able to provide simple financial advice.

“We are still waiting for the details on that, but it is another option where more Australians may get access to financial advice,” Anderson says.

Richard Webb, superannuation lead at CPA Australia, says the Joint Associations Working Group, of which CPA Australia is a member, has been working on a number of different things to improve the ability of people to get advice.

“CPA Australia has been a strong advocate for improving the efficiency of the advice sector and making sure any regulatory changes that go ahead focus on improving the affordability and availability of financial advice to all Australians.”

Mergers and acquisitions

A growing number of advice firms are also merging with or buying out smaller practices to achieve greater scale as well as operational and cost efficiencies.

There is also an increased convergence of accounting and advice within practices. One of Australia’s largest is AZ Next Generation Advisory (AZ NGA), which through numerous mergers and acquisitions has built a group that comprises close to 50 separate accounting and advice practices and 300-plus advisers.

In late 2024, it received a A$240 million capital injection from the US investment group Oaktree Capital Management.

“It is great to see some of the smartest investors on the planet... allocating capital to financial planning in Australia,” says Paul Barrett, AZ NGA’s founder and group CEO. He sees industry consolidation as the best way forward, and he is actively working towards streamlining his network of firms down to just five.

“We believe advice firms should be ambitious around building super firms. So, our strategy is to build a small number of really large financial planning companies.”

Restoring confidence remains a challenge

Recent master fund collapses have left nearly 12,000 Australians facing over A$1 billion in losses. The collapses have put further strain on the government’s Compensation Scheme of Last Resort.

They have also further impacted the advice sector, because some advisers actively recommended that their clients invest most of their superannuation into what were effectively high-risk investments. ASIC recently banned a Melbourne-based adviser from providing financial services for eight years for providing inappropriate advice.

The securities regulator has also been targeting so-called “finfluencers” providing unlicensed financial advice and promoting high-risk, complex investment products.

In the 2024–25 financial year, the Australian Financial Complaints Authority (AFCA) received over 4000 investment and advice complaints. These included 1266 complaints around failure to act in a client’s bests interests, and 432 over failure to follow instructions or agreements. A further 393 complaints related to inappropriate advice.

Despite this, AFCA’s lead ombudsman for investments and advice, Shail Singh, says the number of consumer complaints against advisers specifically has been relatively steady over recent years at around 500 per year, “which is really a positive story for the industry”. 

“I think it shows, firstly, that standards have improved overall. And secondly, it is highly likely that internal dispute resolution processes have improved as well.”