Shane: Hello. My name is Shane Hancock, and I am the Head of Member Products, Guidance and Advice at AustralianSuper. And welcome to our podcast, The moments that count. Before we start, it's important to note that the information discussed in this podcast is general only and doesn't take into account your needs or personal objectives.

You should assess your own financial situation and needs. Today, this podcast is being recorded at our head office on the land of the Wurundjeri people of the Kulin Nation. I and AustralianSuper acknowledges the traditional custodians of country throughout Australia. We pay our respects to elders past and present, and extend that respect to all Aboriginal and Torres Strait Islander people.

Quite often, AustralianSuper members will ask questions that are found through various channels. And mostly those questions are relevant for many members, and so therefore we thought it'd be great if we could share some of those questions and answers through the podcast. 

To help answer those questions, I'll invite a guest expert to join me on the podcast, and today, I'm very happy to be joined by Ross Ackland who leads our guidance and advice teams. Welcome Ross, and thanks for joining me on The moments that count.

Ross: Thanks for having me, Shane.

Shane: So Ross, today we're going to cover off help and advice or guidance and advice. There are various terms that people use, but obviously superannuation and retirement can be complex for many people and what isn't known to many people is how their super fund or other institutions can help them through that journey and some decisions. 

So, that's what we're going to cover off today. So to kick off, could you just run us through the types of help and advice services that are available at AustralianSuper and then we'll start talking about the how and the why people might be looking to seek those services.

Ross: Yeah, so the first thing to start with there, Shane, is that we have over 3 million members. But amongst that membership we have quite diverse ages, obviously, we have quite diverse geographical location and ultimately quite diverse financial situations amongst our membership. 

So that means that the type of advice which our respective members are seeking can be quite different depending on the different member. So, what we try to do is deliver it in a way that each of hose members, there's something there which is going to be helpful for them. So, we broadly deliver our guidance and advice proposition through five channels. 

The first of those is what we call our digital guidance channel. This is through the materials that we have on our website that includes online tools and calculators, videos. We have your podcast, of course, Shane, and there's a lot of written content on there as well to help our members navigate and educate themselves on this situation and on superannuation and retirement generally. 

The second channel is our education seminars and webinars. We have education managers situated around the country, and their job is to meet with members in group settings, generally in a seminar. They also do it online via webinars, but also in workplaces where they are talking to members about superannuation and retirement through what we call general advice. 

The third one is access to simple financial advice. This is where members who have got relatively simple advice needs can speak with a financial adviser over the phone for simple personal advice, or what we call structured general advice. 

The fourth channel is what we call access to comprehensive advice. This is a team of comprehensive financial advisers who are in most capital cities around the country. They're available to sit down and talk through with our members, talk through their full financial situation and provide comprehensive advice to them. 

And then the final channel within our guidance and advice proposition is what we call access to external advice. So there are a lot of AustralianSuper members who have financial advisers, and we have 3500 external advisers that are registered with AustralianSuper. What we'd look to do is try and make it easier for those advisers to work with AustralianSuper because that ultimately benefits the member. And then finally there's a subset of those, or about 150 who in certain circumstances we will refer a member out to them for advice if it's appropriate to do so.

Shane: Thanks, Ross. And I think there's a couple of themes there and we'll touch on the sorts of advice that people might seek, but you talk about that help, that information right through to telling someone what to do based on their personal circumstances, we'll talk about that. 

And that external adviser channel that you just talked about. We do talk about superannuation being only one part of someone's financial self. And a lot of times a member or a non-member will need advice on a broad spectrum. And there are thousands of strong advisers in Australia that are able to help Australians with their retirement and savings needs.

Ross: Yeah, absolutely. What we find with that channel is that because our comprehensive advisers are based in most capital cities around Australia, so sometimes there's a geographical reason that somebody's in a region where they don't want to travel to the city in order to receive advice. So that's a circumstance we'll refer them out.

Shane: So, taking a step back and looking at what help and advice can help someone with. So, someone's thinking about something and they're not sure what to do. Give us some examples of what seeking help and advice can help someone with.

Ross: This can come about at any point in someone's life, and so there are many reasons, but there are key times where, as you say, it might be particularly helpful for somebody to reach out for advice. For example, a major life event, such as having a child, they've bought or sold a home, or they've had some sort of change to their health situation, or indeed of a loved one, or in fact their loved one may have died. 

Somebody could be facing financial challenges, like a debt or unexpected expenses, or on the flip side of that, they may have just received an inheritance or had some other form of financial windfall. It might be just that they've made the decision that they want to get a bit more specific with their financial goals and create a budget. Or it could be as simple as they're unsure about whether they've got their money invested in the way that they want to, and they just want to explore that a bit further.

Shane: I think there's multiple examples, but the main theme that you've picked up there is everyone's situation is different, and so there'll be different needs for different people to seek help and advice. A lot of the time we see people not being aware that they can do that. So we're trying to make it more obvious to people in the way in which we engage with them that there are help and advice services available to them. 

But as you said, there's multiple reasons why someone could benefit from help and advice. We've talked about the different types of advice that someone can get, or you've alluded to different types of advice. And so the terminology we've used is general advice and personal advice. Could you just touch a little bit on the differences between general and personal?

Ross: Yeah, sure. So I think the first thing to talk about is, I'll go to personal advice and that is where a person's situation is being taken into account. And then also there's a recommendation taking place in relation to what that person should do. That's in the simplest form what personal advice is. 

General advice stops short of that in that there might be broad foundations about what might be a good thing for somebody to do, but it's not taking into account their personal situation. And so that's at the simplest level, that's the difference between general and personal advice. 

Shane: Yeah, and that's a good explanation. I think the last thing I'd add to the personal advice is that can only be delivered by a qualified financial planner. So just moving into the personal advice space, quite often we'll hear people say reasons why they won't seek advice, and a lot of the time it relates to the cost involved in financial advice, or at least the perceived costs involved in financial advice in some cases. So could you talk us through for the AustralianSuper services and then maybe even just an industry overview of where advice would cost and how that works?

Ross: So I might even talk about it from the level of guidance and advice generally. So with talking through the respective channels before, obviously everything that we have online through our digital channel that's available to all of our members for free. Indeed, it's available to all non-members for free as well.

The second thing is that the seminars and webinars that I spoke about, there's no cost to attend one of those as well. Then we get into the more personal advice type channels. The first of those being simple advice which is delivered over the phone where that's wholly in relation to your superannuation account, there's no additional cost, it's included within your or membership. Through that channel you can receive more detailed retirement advice, such as transition to retirement or starting a pension account. For that type of advice, a fee may apply.

Shane: So you talked earlier about the types of advice, and some I forget, so in that example, it's simple advice over the phone at no additional cost. Someone may want to get some help on, "Am I in the right investment option or do I have enough insurance?" And those are the sort of services that could be provided as part of the simple advice service? 

Ross: That's absolutely right. 

Shane: Okay. And so moving into the comprehensive financial advice topics which you really touched on was, as the name suggests, comprehensive. It covers a more broad topic and in many cases factors into the whole household, not just the individual. So what would be the costs involved in that?

Ross: It's been the subject of much discussion within the industry about the cost of comprehensive advice and there is real efforts within the industry to seek to lower that over time. When you come to see a financial adviser, but this is true for many advisers. The first meeting is complementary and it's all about the adviser and the members or the individual getting to know one another, exploring the person's personal financial circumstances and their goals. 

And there's generally no personal advice which is provided in that meeting. If in that meeting, the adviser and the potential client decide that they want to pursue an advice relationship, they'll talk there about what the cost of that might be and the adviser then goes away. And based on everything they've talked about, there may be further conversations or information gathered. Based on that, they'll prepare what's called a statement of advice and that will be charged for.

The cost for comprehensive advice is very different across the industry. It will depend very much on how complex that advice is. And it is different from adviser to adviser as well. Within AustralianSuper, that's no different. The actual cost will depend on the complexity of the advice. But it's all agreed upfront and in writing prior to any advice being produced.

Shane: Yeah, I think that's a really important point, is that no services will be provided until the client/member agrees to those services and the fees that will be charged. Okay, thanks, Ross, on that cost part and as I say, a lot of people see a cost or a fee and can be fearful of what that might be or afraid of paying that. But obviously, when you're meeting with the adviser, they'll talk through the benefits and the outcomes they're looking to achieve for that service that they're actually providing.

So, another challenge for many people is who do I know is the right adviser to see and how do I connect with that right adviser? So can you give us some idea on how people might think about finding the right adviser to suit their needs?

Ross: I would say that within the industry more generally, that often people will rely upon word of mouth or they will go to a certain institution that they're associated with. Within AustralianSuper, we do receive a lot of members that come to us, and they are seeking an adviser with the different channels that I talked about before. 

What's really important to us is that when somebody comes to us with an advice need is that we effectively triage them to the right channel. So we have a team internally, which is called the advice appointments team, where somebody gets onto our website and completes a form to say that they are keen to receive some personal financial advice. 

Our advice appointments team will pick that up and give that member a call. They'll have a conversation about their situation and what their needs are, based on that, they will work out whether or not that simple advice that we talked about is more appropriate for them or indeed, if they actually require comprehensive advice. If it is comprehensive advice that they think is more appropriate, then the decision will be made to which adviser might be most appropriate. 

Shane: Yeah, and I think that point is really important. So in our case, the conversation that is had between the fund and the member is all about standing their needs and desire. And as you alluded to earlier, the decision on what adviser is referred to for that member can be anything from location, there could be preferences around wanting to see a male or a female. There could be importantly around topic. So that's how we manage it. But you also alluded to at the very beginning that a lot of referrals come from word of mouth, from family and friends.

There's a lot of advice businesses that are built on that model. So again, it's not an easy pathway, but in our example, we're trying to provide that pathway for members to reach out to us and we'll help guide them through. 

So, someone gets an appointment with an adviser and they're preparing, generally there'll be a little bit of a wait time between that appointment time being booked and the meeting. From your experience, what does someone need to prepare for that first appointment? 

Ross: Different advisers or different advice businesses will have different processes when it comes to that. Many will seek to gather a lot of the information from the potential client upfront before the meeting. And so that will involve a lot of their financial situation and whatnot.

I would say that the most important thing in preparing for an advice appointment that somebody could do is to think about what their goals are, what they really want for their retirement, what's really important to them, the quantifiable sort of things are a bit easier to gather and it's a matter of getting the numbers together. The part which can often be a bit harder for people is to think about, well, what is it that I really want? What am I trying to achieve?

Shane: That's a really important point. That last one is that generally when you're going to see an adviser, if not in all cases, it should be in all cases, the output of that advice, if it proceeds, is how does the adviser help you meet your goals and objectives? So it's really difficult for an adviser to work through what that output looks like without there being some thought put into it from the client or from the member. 

So that's really important that pre-thinking is done. But during the meeting, there's some probing questions that would take place that would allow that to maybe surface itself a bit better too.

Ross: Absolutely. And I think that in relation to the numbers and the things that the person is to pull together in order to put the adviser in a position where they're able to give them good advice, it's that it's really important that they understand their situation fully. So, things which are easier for members or for potential clients to come up with there is to understand their assets and their liabilities and things like that. 

They can access that pretty quickly. What we find is that people might not have quite as good an understanding of their living expenses. That can be a little bit harder to understand. And so it's important to spend, if you can, spend a bit of time understanding your living expenses, because that has a really big impact on what the potential advice might be. 

Shane: Yeah. It's a really important point and we do see that, particularly when people are looking at retirement advice. How much money do I need? The question you'll get asked, how much money do you think you need to live on in retirement versus in work time, and that's sometimes, how long is a piece of string... 

Ross: One hundred percent, and I think that this question about what's the number that I need to retire with, well, that is fully a function of, well, how much is it that you're going to need for your lifestyle in retirement? 

Shane: So you touched on this a little bit earlier, Ross, when we were talking about the cost of advice. But could you just go through what someone might expect when meeting a financial adviser? 

Ross: So, meeting with an adviser is basically a chance for the adviser and the potential client to get to know each other. You'll find out a bit more about how they work and work with you and provide advice. It's also an opportunity for you to really share a bit about yourself, your personal situation, your concerns, your plans for retirement and whatnot. 

In most cases, the adviser will use this meeting as an opportunity to understand your needs and provide a quote for any advice fees moving forward, which is what we talked about before. After that first meeting, your adviser will generally prepare your personal financial plan, which has done so via a statement of advice. 

This is where they present their recommendations to you and explain how it helps meet your goals and work through any questions or changes that you have. Once you're happy with the plan, your adviser will work with you to put that advice into action. They will implement that advice.

It's important to remember though, your financial plan is in a set-and-forget type situation. It is good to come back and review that from time to time to ensure that it remains appropriate.

Shane: Yeah, that's a really important point you raised earlier around situations why people might seek help and advice. And quite often those things will happen multiple times through someone's lifetime. So quite often people will think, okay, well I don't have enough money to seek advice or I'm not ready to retire. But there's a range of different times through someone's life it'd be really important for them to seek guidance and advice and that review process ongoing is really important as your needs, objectives, life situation changes. 

So, Ross, before we finish up, I just wanted to see if you could reiterate the situation where people don't know what they don't know. They don't know how to seek help and advice. And so if you could just finish off with a tip from you on if someone's feeling uncertain around do they need help or how to get help, what would you tell them?

Ross: I think that the most invaluable thing that you can do and what a good adviser will help you do is to really help you feel more confident in your situation. That's, to me, the most important part of advice, probably the most valuable part, is the self-confidence and the peace of mind that it can bring to people that have received it. 

And so if we sort of step that back to your question, then I think that for somebody that's in the situation, thinking about what they should do, something that you'll never regret is to go and educate yourself a bit more about your superannuation, about your financial situation and your retirement. 

It might feel daunting at the start, but if you go and take that step, and that can be done, as I said, working through your superannuation fund's website and what materials might be available there, attending a seminar or a webinar, that should be a no-regret action. You can educate yourself a bit more there. 

That then puts you in a better situation to assess where you're at, what your specific advice need might be from there, and then you're in a better position to be able to work through potentially with your super fund to say, okay, this might be the best next step for you to take in terms of your journey. 

Shane: That's a great tip and a great way to finish. So, thanks for joining us today, Ross. 

Ross: Thanks, Shane. 

Shane: Thank you for joining us today. If you're an AustralianSuper member and you would like to join us to share your story or have a question or topic you would like us to cover, then click the link in our show notes to get in touch. If you've enjoyed this podcast, subscribe and share with your friends and family. See you next time.