Government urged to address shrinking advice profession

With millions of Australians approaching retirement, CPA Australia said urgent action is needed to bolster the financial advice profession before it becomes an “irreversible crisis”.

The 2019 Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry saw the complete upheaval of the financial advice industry, triggering a mass exodus of people from the profession.
At the time of the commission there were some 26,500 advisers. Six years on and there are now just 15,315 registered financial advisers, as at 10 July 2025, almost halving the profession.

CPA Australia superannuation lead, Richard Webb, recognised the tighter regulations put in place following the royal commission were intended to squash the misconduct occurring across the financial services industry, but they also put the profession in a steep decline.

“The cumulative effect of the regulatory burden imposed on the profession in recent years has demoralised advisers to the point where many are now walking away from businesses they grew from the ground up,” he said.

As more than 2.5 million Australians are set to retire in the next decade, Webb said this lack of advisers presents a huge challenge for our ageing population moving into the decumulation phase. 

“With the increasing propensity of retirees to leave their super funds and seek higher investment returns through risky investments, expert financial advice is needed now more than ever,” Webb said.

Not only has the adviser population continued to dwindle over the years, but it has also become increasingly expensive to access, pricing out many of those who need help the most.

Research by Vanguard found half of Australians cited cost as a barrier to seeking retirement planning information and guidance from a financial adviser.

This cost, Webb explained, is largely a result of increasingly stringent compliance requirements, high industry levies, a scarce supply of new entrants, and an ageing population of advisers, many of whom are approaching retirement themselves.

“Investing retirement savings is complex, and carries with it intricate tax and super settings, asset tests, and administrative burdens. However, getting the right advice is only becoming harder to find and more expensive,” he said.

“The federal government must take action to help alleviate the burden of regulation and costs faced by advisers before the shortage becomes an irreversible crisis.”

As such, CPA Australia is urging the federal government to review the regulations and costs that are forcing advisers out of the profession and deterring new entrants.

In particular, CPA is calling for:

• The post-implementation review of the Compensation Scheme of Last Resort (CSLR).
• Updated financial advice education standards.
• Changes to the financial advice best interest duty.
• Clarification on the role of the new class of adviser.

While all of the above are on the government’s agenda, it is unclear when the profession can expect to see any meaningful outcomes.

“Government needs to work constructively with the profession to understand these challenges and begin to address them as quickly as possible.

“Superannuation funds could also do more to help prepare their members for retirement – as required by the Retirement Income Covenant – but their ability to make appropriate advice solutions available is diminished by the exodus from the profession.”