The changes to superannuation announced in Tuesday's budget will see more financial advisers focus on investment strategies outside of super, according to researcher DEXX&R.
DEXX&R said the government's plan to lower the superannuation concessional contributions cap to will have an impact on future super guarantee contributions.
"The 2016 budget changes result in a significant reduction in the amount that members can contribute in addition to employer SG contributions and stay within the maximum concessional contribution limit," the company said in a statement.
"For those earning more than twice the current average salary of $80,000, the opportunity to contribute meaningful additional concessionally taxed contributions over the next ten years is significantly reduced."
As a result, advisers with high income clients will increasingly opt for strategies outside of super. It will also become difficult to sell advice to super fund members, DEXX&R said.
"With limited scope for a meaningful uplift in voluntary member contributions it will become increasingly difficult to justify the current cost of full financial advice to super fund members," it said.
"Low cost financial advice solutions such as robo-advice will play a larger role and become the most cost effective advice delivery mechanism for middle and low income members."
SUBSCRIBE TO THE IFA DAILY BULLETIN
- 20 Oct 2017Parliamentary insurance group formedBy Staff Reporter
- 20 Oct 2017Treasurer introduces BEAR legislationBy Aleks Vickovich
- 20 Oct 2017Westpac to refund $65m to customersBy Annie Kane
- 20 Oct 2017Survey tips independent takeoverBy Aleks Vickovich and Jessica Yun
- 18 Oct 2017AFA suffers budget blowoutBy Killian Plastow
- 18 Oct 2017ISA ups ante on governance lobbyingBy Aleks Vickovich
- view all