FAAA seeks to limit super involvement in retirement planning

Mike Taylor

Managing Editor and Publisher

7 May 2025

The Financial Advice Association of Australia (FAAA) has urged limits on the degree to which superannuation funds can provide retirement planning advice, stating that it should not be delivered on a collectively charged basis.

In its submission responding to the Government’s Delivering Better Financial Outcomes exposure draft, the FAAA has also sought to exclude people receiving external financial advice from being “nudged” by superannuation funds in respect of retirement planning.

The FAAA’s response also makes clear that the draft legislation released is too narrow to make a comprehensively definitive response and has asked that an opportunity be given when a further tranche is released.

The FAAA has listed its key recommendations responding to the DBFO second tranche as being:

• Retirement planning advice will always be complex and costly advice and should not be provided on a collectively charged basis.
• Consumer protection is paramount in the provision of super nudges, particularly with respect to retirement planning, and members should be made fully aware of the implications of acting upon these nudges.
• Super nudges should not be provided to superannuation fund members with an external financial adviser or at least should be subject to a notice to disregard the nudge if they have already obtained financial advice.
• The financial advice regulatory regime should be principles based and permit professional financial advisers to rely upon their professional judgement. ASIC guidance and enforcement must reflect this design principle.
• The opportunity to utilise a Record of Advice should be substantially expanded to better enable the use of this streamlined form of financial advice.
• Every effort must be made to sensibly rationalise what needs to be included in an advice document, including with respect to eliminating the prospect of additional obligations being added at a later time through regulation or ASIC guidance.