The Australian government is set to implement reforms to the educational requirements for financial advisers, aiming to establish a more sustainable pathway for new entrants into the profession.
Financial Services Minister Stephen Jones outlined the government's intention to address the existing education framework, which he described as unsustainable.
“The Albanese Government is committed to rebuilding a robust financial advice sector, ensuring that all Australians have access to high-quality, affordable financial guidance,” Mr Jones stated.
“The Government will reform the education requirements for professional financial advisers to create a sustainable pathway for new advisers to enter the profession.”
Mr Jones pointed to the previous Coalition government's policies, which he claimed had led to a decline in the number of financial advisers, dropping from 28,000 in January 2019 to fewer than 16,000 today.
As part of the reforms, the government will introduce changes to the educational pathway for advisers. This will involve simplifying the process and making it easier for individuals to enter the profession.
At present, aspiring financial advisers must complete a specialised qualification, a 1,600-hour professional year, pass a financial adviser exam, and adhere to continuing professional education (CPE) requirements. However, Mr Jones explained that this structure has failed to attract school leavers, and many career changers find it a costly and complex route. Additionally, fewer universities and institutions are offering courses in the field due to a lack of new entrants.
Under the Government’s changes, the proposed education standard will centre around a new requirement to hold a bachelor’s degree or higher in any discipline.
“Prospective advisers will need to meet minimum study requirements in relevant financial concepts such as finance, economics or accounting,” Mr Jones said. They will also need to complete financial advice subjects covering ethics, legal and regulatory obligations, consumer behaviour and the financial advice process.”
“This provides relevant core knowledge for an adviser, streamlines entry into the industry and retains the important role of tertiary education.
“It will also bring down the costs on prospective advisers and make it easier for people to change careers into financial advice later in life.
Mr Jones emphasised that these changes would make the profession more accessible by reducing costs and time for prospective advisers, particularly those with a background in commerce, economics, or finance.
For those transitioning from other financial services careers, the new standard is expected to significantly reduce both the time and cost involved in meeting the necessary qualifications.
Advisers will still need to complete a professional year, pass the financial adviser exam and undertake ongoing continuing professional education.
Jones noted that the reforms would also support the proposed creation of a new class of advisers (NCAs), which he had previously updated in December.
“The pathway will be designed to facilitate a smooth transition for NCAs into full financial adviser roles,” he said.
Furthermore, the government will halt the second phase of the registration process under the Better Advice Act, which was set to require financial advisers to re-register annually with the Australian Securities and Investments Commission starting in July 2026. Mr Jones argued that this was unnecessary, as advisers are already registered through their Australian Financial Services licensees.
“These reforms are part of the government’s broader efforts to address the current shortage of financial advisers, reduce red tape that doesn’t benefit consumers, and strengthen the industry’s capacity to meet future demand for financial advice,” Mr Jones concluded.
