Understanding the Statement of Advice (SOA) in 2026: A Guide for Australians

A Statement of Advice is a written document provided by licensed financial advisers when they give personal financial advice. The SOA explains the adviser’s recommendations, the reasons for those recommendations, and discloses any relevant fees, risks, and potential conflicts of interest. This document is required by law whenever you receive personal (as opposed to general) financial advice in Australia.

The SOA is designed to help you:

• Understand what your adviser is recommending and why
• See all the costs and fees involved
• Be aware of any risks or downsides
• Compare alternative strategies or products considered

You should receive your SOA before you act on the advice, or as soon as practicable after the advice is provided. This gives you time to review the recommendations and ask questions before making any decisions.

In response to ongoing reviews and feedback from consumers, the Australian government and regulators have introduced changes to make SOAs more concise and easier to understand. These reforms are intended to help Australians make more confident decisions about their finances.

Key updates to SOAs in 2026 include:

• Shorter documents: SOAs are now generally limited in length, unless the advice is particularly complex.
• Plain language: Advisers are encouraged to use clear, direct language and avoid unnecessary jargon.
• Visual aids: Bullet points, tables, and charts are used to make information easier to scan and compare.
• Clear disclosure: All fees, commissions, and potential conflicts of interest must be summarised in a straightforward way.
• Highlighting risks and alternatives: Key risks and alternative strategies are presented upfront, so you can see your options clearly.

SOAs can now also be delivered digitally, including interactive online formats. This makes it easier to access, store, and review your advice documents, especially if you prefer managing your finances online.

Every SOA should include certain core sections, regardless of your financial goals or the complexity of your situation. Here’s what you can expect to find:

1. Adviser’s Recommendations

This section outlines what your adviser suggests you do—whether it’s investing in a particular fund, changing your superannuation, or adjusting your insurance cover. The recommendations should be tailored to your personal circumstances and goals.

2. Reasons for the Advice

Your SOA will explain why the adviser is making these recommendations. This might include your financial objectives, risk tolerance, and any relevant personal details you’ve shared.

3. Fees and Costs

All fees, commissions, and charges associated with the advice and recommended products must be clearly disclosed. This includes upfront fees, ongoing costs, and any commissions paid to the adviser. You should be able to see a summary of all costs in one place.

4. Risks and Downsides

The SOA should outline any potential risks or downsides of following the advice. For example, if you’re considering an investment, the document should explain the possibility of losses or market fluctuations. If insurance is involved, it should clarify any changes to your cover or premiums. For more on insurance advice, see insurance brokers.

5. Alternatives Considered

A good SOA will also mention other strategies or products that were considered, and explain why they were not recommended. This helps you understand the range of options and why your adviser believes their recommendation is the most suitable for you.

6. Conflicts of Interest

Any potential conflicts—such as commissions or relationships with product providers—must be disclosed. This transparency helps you assess whether the advice is truly in your best interests.

Receiving an SOA is an important step in your financial journey. Here’s how to make the most of it:

Start with the Summary

Most SOAs begin with an executive summary or overview. This section gives you a snapshot of the main recommendations and their intended outcomes. It’s a good place to start before diving into the details.

Review the Fees and Costs

Check the section that lists all fees and costs. Make sure you understand what you’ll be paying, both upfront and over time. If anything is unclear, ask your adviser for clarification.

Understand the Risks

Read the risks section carefully. Make sure you’re comfortable with the potential downsides before proceeding. If you’re unsure about any risks, discuss them with your adviser.

Consider the Alternatives

Look at the alternatives that were considered. Understanding why certain options were not recommended can give you more confidence in the advice you’ve received.

Ask Questions

If any part of the SOA is unclear, or if your circumstances have changed since the advice was given, don’t hesitate to ask your adviser for clarification or an updated SOA.

As a client receiving personal financial advice, you have important rights:

• You are entitled to a clear, tailored SOA that addresses your specific needs and goals.
• You can request clarification or a revised SOA if your situation changes.
• Advisers must act in your best interests and disclose any conflicts of interest.
• You should keep your SOA as a record of the advice you’ve received. This can be useful if you want to review your decisions, seek a second opinion, or make a complaint.

If you believe your SOA is unclear or incomplete, you can seek further assistance through the Australian Financial Complaints Authority (AFCA) or other relevant bodies. Digital SOAs make it easier to store and share your documents securely.

The Statement of Advice is a vital tool for anyone receiving personal financial advice in Australia. In 2026, recent reforms are making SOAs clearer, shorter, and more focused on your needs. By understanding what’s in your SOA and how to use it, you can make more informed decisions about your financial future—whether you’re investing, planning for retirement, reviewing your insurance, or considering other financial strategies.