Why More Australians Say They’ll Spend Big On Advice

Financial advice affordability has been on the news and the political agenda for many years now, with concerns frequently raised about the number of Australians being priced out. As advisers know, this has recently been the subject of a major Treasury inquiry.

It’s not surprising, given our recently released 2023 Landscape Report showed the median advice fee jumped 48 per cent in five years, to $3710. The average fee is now $4000, with some advisers charging up to $13,000.  

Our research has repeatedly shown most Australians who want advice can’t afford to pay what most professional financial advisers charge. When we surveyed consumers earlier this year, more than three-in-five said they couldn’t pay more than $500.

However, we also found a significant year-on-year increase in the number of Australians willing and able to spend the median advice fee or more. Almost one-in-five consumers we surveyed said they were both equipped and prepared to pay between $2500 and $5000.

What’s driving this? Has a segment of the market been putting more money away for the future? Has the perception of professional advice changed? Or are a growing number of Australians realising advisers can help navigate their current financial challenges?

Figure 1 – How much consumers would pay for advice



Source: Adviser Ratings' Australian Financial Advice Report 2023. Inner circle = 2021; outer circle = 2022.

Financial uncertainty and the value of advice

To explore why we’ve seen a spike in the number of Australians willing to spend more on advice, we took a closer look at the attitudes and beliefs of consumers who fell into these categories.

We found concerns about inflation were linked to consumers’ willingness to pay more than the typical fee. More than half of the unadvised consumers we surveyed who said they’d spend $5000 a year on advice were worried the cost of living would increase further. Meanwhile, advised consumers who said they’d pay $5000 or more for advice unanimously believed inflation would stay the same or increase.

While most Australians we surveyed expected property prices to stay the same or fall, a third of unadvised Australians willing to spend up to $5000 said they expected the market to rise. The expectation was mirrored in the third of unadvised consumers who would pay more than $5000 for advice.

While each individual and couple have their own drivers determining the value they place on financial advice, our analysis indicates current economic and financial conditions have caused some Australians to re-evaluate how much they would pay for it.  

We also expect practices to be fielding more enquiries about investing during inflationary times and budgeting, based on our survey responses. With fewer than 16,000 advisers left in Australia, however, there will still be many Australians with unmet advice needs.

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