New caps on superannuation advice fees: what the Treasury reforms mean for you
On 19 August 2024, the Australian Treasury released a fact sheet detailing a package of superannuation reforms titled Protecting Consumers and the Promise of Superannuation in an Evolving Financial Ecosystem. Among the measures is a plan to legislate caps on the advice fees that super trustees can deduct from member accounts.
We believe it is important to be clear about where this stands.
These are announced reforms, not yet law, and the specific details may change as legislation is drafted. The package follows high-profile fund collapses, and much of the public discussion has naturally focused on cost control and preventing the erosion of retirement balances by disproportionate fees.
However, for the Melbourne and Geelong professionals we work with—healthcare workers, legal professionals, and educators in their 40s—the real story isn’t just about the fee itself. It is about transparency and the definition of ‘value’.
What has been announced?
The Government intends to require super trustees to implement and comply with caps on advice fee deductions. The package also proposes a new class of adviser within super funds and higher maximum penalties for trustee breaches.
The stated aim is to ensure that money intended for your retirement isn’t eroded by fees that aren’t commensurate with the service provided.
Because insurance premiums and advice fees often come out of a super balance rather than take-home pay, these costs can easily become invisible. We see these reforms as a way to bring that spending into the light.
A cap does not change the cost of advice
There is a nuance here that we often find gets missed in the headlines.
A cap on what can be deducted from a super fund does not mean the cost of providing professional advice has decreased. Instead, it sets a ceiling on what your super fund is permitted to facilitate on your behalf.
For families with complex needs—such as those requiring tailored Life, TPD, and Income Protection strategies alongside a structured wealth creation plan—the way you engage and pay for that advice may simply become more structured. The cost of the advice is usually a reflection of complexity, regardless of how the payment is processed.
Moving beyond ‘product’ advice
We have long maintained that the value of advice is never found in a product recommendation. In a digital world, you can find a generic policy online in minutes. The real value lies in the strategy that surrounds it.
When we work with professional families, the focus is rarely on the fund itself, but on the outcomes it enables. This shift toward transparency forces a necessary conversation about what you are paying for.
For most of our clients, that value is found in three areas:
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Strategic integration: Ensuring your insurance, super contributions, and mortgage repayments are working together rather than competing for the same dollar.
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Clarity: Translating complex policy definitions into plain English, so you know exactly what it all means for your specific career and family circumstances.
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Claims advocacy: Having a dedicated partner to manage the paperwork and hurdles if you ever need support – a safety net that removes the burden during emotional times.
A partnership, not a transaction
If you have been wary of ‘wealth leakage’ from your super, a focus on advice fees is a positive step. It reminds us all that your super is your money.
Whether we are helping you build wealth or protect it, we believe you deserve to know how every dollar is being used.
The best financial advice has always been about more than numbers; it’s about the peace of mind that comes from knowing your family is protected by a sensible, transparent plan.
If you are unsure how your current advice fees are structured, or whether your insurance cover still fits your current life stage, we are here to provide that clarity.