Advisers ‘essential guides’ for retirement income confidence, research shows

Australians who receive professional advice demonstrate a significantly better grasp of their superannuation investments, contribution strategies, and withdrawal options than those who do not seek advice, according to new data from Findex.

Namely, advised Australians displayed a markedly higher level of understanding of how their superannuation is invested, with almost three-quarters (73 per cent) reporting strong or some understanding compared to less than half (47 per cent) for their unadvised counterparts.

“This disparity underlines the value of professional advice in educating individuals about investment options within superannuation, a foundational component of financial literacy,” Findex said.

Seventy-one per cent of advised individuals also claimed to have a strong or some understanding of the ways funds can be contributed to super, with this being less than half (49 per cent) for those who hadn’t gone to an adviser.

The value of advice was not only measured by an increase in knowledge, but also by how Australians engaged with their super thereafter – advised Australians were far more likely to have a more “engaged and strategic” approach to superannuation management, Findex noted.

Namely, almost four-fifths “proactively contributed” or are considering contributing to their super balance compared to 60 per cent of non-advised Australians, while a similar number (78 per cent) said they often think about their superannuation and how it is performing compared to 58 per cent for their counterparts.

“To take a proactive engagement to retirement savings, confidence in managing and growing superannuation is essential and can lead to more strategic decision making, better risk management, and ultimately, a more secure financial future. And our results demonstrate that professional advice has a pronounced impact,” the firm said.

As such, Findex said that advisers serve as “essential guides” in navigating the complexities of superannuation, providing clarity and instilling confidence among Australians as they plan for their future prosperity.

“The data suggests a clear call to action for those who have not yet engaged with a financial planner to consider the substantial benefits of doing so.”

Data recently released by Colonial First State (CFS) similarly highlights Australia’s changing perceptions of retirement and the role financial advice can play to increase confidence in retirement.

“Our research found that Australians who plan early, engage with their super, and get advice have considerably greater certainty over when they retire, are more confident about their financial position, and are more likely to enjoy their retirement,” CFS said.

“Greater access to affordable advice is essential to ensuring more Australians can enjoy the comfortable retirement of their choice.”