General vs Personal Financial Advice - What's the Difference

A distinction that matters more than most people realise

When you read an article about superannuation strategies, watch a finance video on YouTube, or get told by your bank that a particular product "might suit your needs" - that's probably general advice. When a licensed financial adviser sits down with you, reviews your specific situation, and tells you what they think you should do - that's personal advice. The difference isn't just semantic. It determines what legal obligations the person giving you advice actually has.

What general advice is

General advice is financial information or a recommendation that hasn't taken your personal circumstances into account. It's the kind of advice that could apply to a broad range of people rather than being tailored specifically to you.

Examples include a superannuation fund's website explaining the benefits of salary sacrificing, a financial comparison site showing you the features of different insurance policies, a bank teller suggesting you consider a term deposit, or a newspaper columnist writing about whether now is a good time to invest in property.

None of these have considered your income, your debts, your family situation, your tax position or your goals. They're general observations that may or may not be relevant to you.

Providers of general advice are required to tell you that they're giving you general advice and that it doesn't take your personal circumstances into account. You've probably seen this disclaimer hundreds of times without paying it much attention. It's there for a reason - it means the person giving you the information has no legal obligation to ensure the advice is actually suitable for you.

What personal advice is

Personal advice is a recommendation that has been tailored to your specific circumstances. To give personal advice legally, an adviser must hold an Australian Financial Services licence, or be authorised under one. They must also comply with the best interests duty - a legal obligation introduced as part of the Future of Financial Advice reforms, which requires advisers to act in your best interests when making personal recommendations.

Before giving personal advice, a licensed adviser is required to gather information about your situation - your income, assets, debts, goals, risk tolerance and any other relevant circumstances. This process is sometimes called a fact find. The advice they give you must be based on that information and must be appropriate to your situation.

Personal advice must also be documented in a Statement of Advice, which sets out the recommendation, the reasoning behind it, and any conflicts of interest the adviser has. General advice providers have no equivalent obligation.

Why this matters in practice

The practical consequence is that if you receive general advice and act on it, and it turns out to be completely wrong for your situation, you have very limited recourse. The provider told you it was general advice. You were warned.

If you receive personal advice and the adviser failed to take your circumstances properly into account, or recommended something that wasn't in your best interests, you have the right to make a complaint - through the adviser's internal complaints process first, and then through the Australian Financial Complaints Authority if you're not satisfied with the outcome.

This is why the distinction matters when you're making significant financial decisions. If someone is recommending a specific action with your money - consolidate your super here, take out this insurance policy, put your savings into this investment - you should understand whether that recommendation carries any legal weight or whether it's just a general suggestion they have no obligation to stand behind.

The grey area

The boundary between general and personal advice isn't always obvious, and there have been cases where financial institutions provided what was effectively personal advice while calling it general advice, specifically to avoid the obligations that come with personal advice. ASIC has taken action against a number of institutions for this. If you're being given what feels like a tailored recommendation, ask the person directly: is this personal advice? Are you taking my specific circumstances into account?

If they say yes, they're giving you personal advice and all the obligations that go with it apply. If they say no, you know to treat the recommendation as general information rather than a conclusion you should act on without further consideration.

Scaled advice

There's a middle ground worth knowing about called scaled advice, sometimes called limited advice. This is personal advice, with all the legal obligations that entails, but limited to a specific topic rather than covering your whole financial situation. An adviser might provide scaled advice on just your insurance needs, or just your superannuation investment options, without doing a full financial plan.

Scaled advice has become more common as the industry has looked for ways to make financial advice more accessible without the cost and complexity of a comprehensive financial plan. It's a legitimate option if you have a specific question you want properly answered.

Finding a licensed adviser

Only a licensed financial adviser can give you personal financial advice. All advisers licensed to provide personal advice in Australia must be registered on the ASIC Financial Advisers Register. You can search for a registered adviser near you on this directory, and check their authorisations, qualifications and any disciplinary history before making contact.

If you're in a specific area, you can also browse by state - New South Wales, Victoria, Queensland and all other states are covered, with suburb-level search available across the country.