The Government should proactively encourage Australians to seek superannuation advice to help maximise their retirement incomes, according to the Financial Planning Association (FPA).
This view was outlined in the FPA’s latest submission to the Parliamentary Joint Committee on Corporations and Financial Services.
The submission also called for a Government review of the length and complexity of Statements of Advice to make superannuation advice more accessible and greater transparency across the industry.
FPA chief executive office Jo-Anne Bloch said transparency of the operations and costs associated with all superannuation funds was necessary to make it easier for consumers to compare the merits of particular funds.
“[The] FPA’s inaugural Value of Advice Awards in 2006 … give compelling evidence of the importance of financial planning, not only for those who are accumulating wealth, but for people with limited financial resources,” Bloch said.
Bloch said inadequate financial advice and planning could result in dramatically reduced retirement benefits.
“Superannuation is a national asset that is too important to the retirement plans of Australians for the role of advice to be ignored. Without advice, many will be unable to use super savings effectively to generate retirement incomes,” Bloch said.
Bloch used the July results of an Investment and Financial Services Association Newspoll survey of 18-64 year olds in Sydney, Melbourne and Brisbane to emphasise the importance of superannuation advice.
Over two-thirds of the 413 respondents agreed a qualified financial planner was the best person to help them with their financial affairs.
“People with a financial planner were more likely to have less debt, invest any windfall in superannuation, understand what factors contribute to their super fund earnings and make extra contributions to their super fund,” Bloch said.