Accessing personalised financial advice is increasingly difficult for average Australians as advisers now require fees that only the wealthy can afford. This change helps maintain adviser profitability and business value, but it excludes everyday investors.
In recent years, the financial advice industry has contracted significantly and become more expensive for consumers. Once dominated by major banks, the sector has been transformed by scandals, stricter regulation and a declining number of advisers. In 2019, there were 25,000 licensed advisers. Today, that number has fallen to 15,488.
Consulting firms reviewing adviser practices have highlighted that clients paying under $3,000 each year tend to reduce a practice’s resale value. Advisers focusing on personalised service now target clients who can pay between $4,000 and $8,000 per year or more. Some top-performing firms earn $1 million in fees from every 100 clients, averaging $10,000 per client.
This trend is dividing the industry. At one end, there is low-cost, automated advice through digital platforms built on standard investment models. At the other, there is bespoke advice that serves only high-net-worth individuals. Many Australians do not fit into either of these categories.
The system also faces structural pressures that make quality advice harder to access. Increasing regulation adds hours of compliance and administrative work that often has little to do with financial planning. Combined with advisers’ limited capacity to meet clients individually, even through video calls, this contributes to a preference for clients who offer consistent, high returns.
Most Australians could benefit from some financial advice, especially during major life events such as receiving an inheritance or dealing with redundancy. However, these one-off situations do not attract advisers who focus on long-term revenue streams. Without thousands to spend each year or a large investment portfolio, many Australians are finding themselves locked out.
