New research from CPA Australia and CoreData estimates that if every Australian was able to access “properly implemented” professional advice, the benefit to the nation’s per capita GDP would be in the order of $24,716 per person, per year.
The Value of Advice Research report, which included accountants, financial advisers, tax agents and mortgage brokers under the “professional advice” banner, found manifest benefits for people who received, and correctly implemented, advice.
Over 80 per cent of consumers and SMEs said they have had greater peace of mind since receiving professional advice, the report noted, while those that don’t receive it are more likely to experience “negative impacts” in their life. “These include mental, physical and relationship impacts,” the report added.
The estimated $24,716 per person uplift, which was ascertained using 2019 Australian per capita GDP figures, would equate to $630.26 billion per year.
The data used for modelling was based on a range of interviews and a quantitative survey of 1,244 consumers and 815 SMEs, which CPA Australia says focussed on “the emotional and intangible benefits that advice brings”.
After establishing that more widespread access to advice would provide greater benefits to consumers, including improved retirement outcomes, the report tackled the question of why more people don’t seek professional advice.
The issue, CPA Australia said, is that the different areas of advice (ie budgeting, retirement, loans, tax) are governed by different areas of legislation and regulation, without a centralised approach.
“If we are to build a truly client-centric advice model we need to rethink the way professional advice is regulated,” the report states. “Reform must not only reduce the regulatory burden and complexity… it must deliver a model that serves the interests of individuals and SMEs by looking beyond product to how clients view and use professional advice.”