AI advice boom highlights urgent need for affordable advice: SMC

Australians are increasingly turning to artificial intelligence to understand their superannuation and retirement options, but new research suggests many remain reluctant to rely on AI alone for major financial decisions.

Research commissioned by the Super Member Council (SMC) found two thirds of Australians have either used AI for super and retirement information or would consider doing so, while more than one in three have already used tools including ChatGPT, Gemini and Claude.

Among those using AI, the technology is primarily being used to learn the basics, ask questions and compare options.

However, Australians remain concerned about the privacy, security and accuracy of AI-generated financial information, with many preferring human support when dealing with sensitive financial matters.

SMC chief executive Misha Schubert said the findings highlighted demand for affordable and trusted financial guidance.

"Australians are increasingly turning to AI because they are looking for simple, accessible and affordable help to understand their super and retirement options," Schubert said.

"But people are also telling us they really don't want to rely on AI alone. They want trusted sources of information, strong consumer safeguards, and access to human support and reassurance when making financial decisions that will affect their future."

Nealy half of Australians who use AI said they would verify information directly with their super fund, while others would seek confirmation from government websites, financial advisers or other professionals.

Schubert said the findings strengthened the case for the government to progress its long promised Delivering Better Financial Outcomes (DBFO) reforms.

"Australians shouldn't have their advice options limited to only expensive full-service comprehensive financial advice on the one hand or the Wild West of unregulated AI tools on the other, with nothing in between to serve the needs of 'the missing middle'," she said.

The Financial Advice Association Australia (FAAA) has separately called on the government to prioritise affordable advice, citing a 65% increase in the median cost of financial advice over the past five years to about $4700.

FAAA chief executive Sarah Abood said rising costs were limiting access to advice as Australians faced increasingly complex financial decisions.

"Financial advice has never been more important, but too many Australians simply cannot afford it," Abood said.

The FAAA is calling for sustainable compensation arrangements, stronger protections against predatory lead generation, sensible DBFO reforms and measures to grow the advice profession.

According to FAAA research, nine in 10 advisers expect the CSLR levy to further increase the cost of advice, with the average practice facing a bill running into thousands of dollars per adviser.

"Innocent financial advisers are currently paying these bills, and in many cases are forced to pass the costs on through higher advice fees," Abood said.

"Consumers should not have to pay even more for professional financial advice because of failures by completely unrelated firms and in other parts of the financial services system."