There are two broad definitions of types of financial advice in Australia. Financial advice helps you make decisions about your money and can be tailored to your situation (personal advice) or general financial information (general advice).

Personal financial advice
Personal financial advice is where an adviser makes recommendations for a financial service or product after considering one of more of your objectives, financial situation and needs. Where a financial adviser provides you with personal financial advice, they must provide you with a Statement of Advice (SOA). Your adviser will consider the information you have provided him/her, carefully consider your financial goals and provide the SOA in writing that sets out what your adviser is recommending and why they think it's suitable for you.

General financial advice
General financial advice refers to general information regarding financial products but is not recommended as to its suitability for the client. The product adviser does not select from a group of potential products which might be more suitable for the client in relation to their personal needs, circumstances or objectives.

Determining the type of advice you are receiving
Regardless of the type of advice you receive, you should consider the Financial Services Guide (FSG) of the service provider before you start dealing with them. The FSG will explain:

• the services they offer including the type of advice
• how they operate
• how they get paid (including any commissions)
• how they deal with customer complaints, and
• any interests, associations or relationships that could influence them.

The Financial Services Guide will help you make an informed decision as to whether you want the services on offer.

Personal advice can be valuable, but will take time and money to prepare and not everyone requires personal advice. Many people successfully manage their own finances and there are many sources you can turn to learn about investment. 2020 DIRECTINVEST is a free service that empowers investors with financial tools and information (general financial advice) to make and execute investment and superannuation decisions in the most cost effective manner.