Advice

With higher interest rates and inflation upending investment dynamics, advisers say they’ve already begun transitioning their clients toward fixed income and defensive assets following a long period when duration didn’t have much to offer.

Financial advice will take a different shape in the future, with the infamous Statement of Advice no longer mandatory and swathes of red tape slashed. The government has also plumped for super funds to play a much larger role in the advice spectrum.

A desire to flaunt ubiquitous wealth on social media is putting moneyed families at risk, according to family office representatives, with extortion and kidnapping “a legitimate concern”.

While advisers are still the first choice for investment advice – especially among the emerging affluent – the needs of Australia’s growing cohort of high-net-worth investors are evolving, as more seek validation of their own investment ideas rather than holistic advice, platform provider Praemium says.

Much of what keeps Australian investors up at night – and the biggest investment mistakes they make – could be avoided through a greater focus on financial literacy, especially as markets “start acting like markets again”, the private wealth manager’s directors Jamie Nemtsas and Drew Meredith said.

Consumer access to sound advice comes first, according to Michelle Levy, the Allens partner who recently led a review into the sector. She urged the government to dispense with any further consultations and get on with implementing the review’s far-reaching reforms.

The 2023 EY Global Wealth Management Research Report showed 37 per cent of Australian investors think managing their wealth has become more complex in the past two years, with nearly half reporting they are looking for more financial advice across investment services.

Australians who consider themselves expert in financial investment knowledge are nearly as likely as beginners to speak with a financial adviser, a recent survey shows, reflecting the impacts of rising inflation and interest rates on investors’ confidence and highlighting an important role for financial experts.

Netwealth and HUB24 are expected to continue eating the incumbents’ lunch, according to UBS. Meanwhile, as adviser numbers have halved the average amount of money they manage has doubled.

Australians should be putting more money into superannuation and diversifying out of property, some say, even as super performance remains a question mark.

It was a COVID-inspired idea that fell foul of the electoral cycle, but the nation’s small business advisory peak bodies continue to push for subsidised advice for small businesses.

As the quantum of advisers has decreased those that remain have consolidated client books, which has led to a higher proportion of high-balance SMSFs coming under advice.