Actuaries propose ‘guidance’ as advice missing link

Mike Taylor

Managing Editor and Publisher

28 October 2025

The Actuaries Institute is canvassing the need for legislative backing for a new advice tier ‘guidance’ which will sit between general and holistic advice.

The institute has issued a discussion paper which canvasses the role of ‘guidance’ which would entail “direction, tailored nudges based on consumer circumstances (e.g., fund prompts, risk alerts. Required defined boundaries and safeguards but not the full rigour of personal advice”.

The discussion paper has suggested a framework of Help, Guidance and Advice, noting that it establishes “a continuum of financial support options, providing clarity on what can be offered under each category:

1. Help: Provision of factual information, tools and calculators to support understanding. No personalisation, minimal regulatory burden.
2. Guidance: Directional, tailored nudges based on consumer circumstances (e.g., fund prompts, risk alerts). Requires defined boundaries and safeguards but not the full rigour of personal advice.
3. Advice: Personalised, professional recommendations that consider the individual’s financial situation and objectives. Subject to existing professional and regulatory standards.

The discussion paper notes that Government reforms will be essential beyond the implementation of the Delivering Better Financial Outcomes package, with the HFA proposal critical to increasing access to affordable HGA “with superannuation funds playing a pivotal role alongside financial advisers, other financial institutions and digital solutions.

However, it said a broader framework would need to accommodate the change.

“Current regulation tends to treat all advice as equally complex, failing to distinguish between simple guidance and comprehensive planning. Many consumers require support varying from Help to Guidance to different levels of Advice complexity – each serves a distinctive purpose,” the discussion paper said.

“Currently operating in regulatory grey areas, Guidance bridges factual information and personalised advice. It enables scalable, cost-effective support for the millions who need more than basic help but less than comprehensive advice.

“Superannuation fund trustees face a tension between their obligation to support members (including Retirement Income Covenant requirements to ‘identify and recognise broad retirement income needs’) and complex financial advice regulations. The HGA framework, supported by DBFO reforms, provides a pathway to resolve this ‘Trustee Dilemma ’while enabling funds to better serve their members,” it said.

Commenting on the discussion paper, the chair of the Institute’s HGA Working Group, Andrew Gale said the proposal would ensure people had access to basic financial facts through guidance and suggestions on retirement goals, as well as comprehensive personal advice on a range of issues.

“Middle Australia stands to benefit most because comprehensive personal advice is out of reach for many, but help, guidance and specific purpose simple advice at pivotal moments would significantly improve their financial wellbeing,” he said.

“Our framework provides the architecture that will enable millions of people of all ages to receive support in different levels of complexity and that fits their individual needs.”