For financial advisers, the combination presents two distinct but closely related developments: technology offering the potential to substantially improve practice productivity, while demographic change increases the need for advice around retirement, longevity and the transfer of wealth between generations.<\/p>\n
AI and the advice proposition<\/strong><\/p>\n Treasury describes AI as a defining influence on the Australian economy over the next 40 years, with advances in the technology representing perhaps the most dramatic change since the previous IGR in 2023.<\/p>\n The implications for advice practices are potentially significant.<\/p>\n AI has the capacity to reduce the resources devoted to administrative, analytical and other process-driven functions, potentially allowing advisers to spend more time on client engagement, strategy and complex decision-making.<\/p>\n …analysis points towards AI augmenting much human work rather than simply replacing it<\/p><\/blockquote>\n Importantly for advisers, Treasury’s analysis points towards AI augmenting much human work rather than simply replacing it.<\/p>\n The report also arrives as the advice profession continues to grapple with the challenge of delivering advice more efficiently and to more Australians \u2013 suggesting the productivity dividend from AI could become increasingly relevant to the economics of advice delivery.<\/p>\n An older Australia<\/strong><\/p>\n At the same time, advisers will be serving a markedly older population.<\/p>\n Treasury says population ageing is occurring more rapidly, accelerated by falling fertility rates. The Government’s latest population projections expect Australia’s median age to reach 40 within the next decade and 43.7 by 2065\u201366.<\/p>\n This demographic shift has potentially significant implications for the nature of financial advice.<\/p>\n …greater emphasis on retirement income planning, longevity risk, aged care funding and estate planning<\/p><\/blockquote>\n Longer lives and an increasing proportion of older Australians should place greater emphasis on retirement income planning, longevity risk, aged care funding and estate planning, alongside the transfer of accumulated wealth to younger generations.<\/p>\n It also places greater importance on advice extending beyond the traditional accumulation phase and into managing clients’ finances throughout retirement.<\/p>\n The previous IGR had already projected the proportion of Australians aged 65 and over to rise substantially, noting that population ageing would have important consequences for the design of both the superannuation and tax systems. The 2026 report now says declining fertility is accelerating that ageing trend.<\/p>\n For financial advisers, the two forces highlighted in the latest IGR therefore intersect in a significant way.<\/p>\n AI offers the prospect of delivering advice more efficiently, while Australia’s changing demographics point towards an expanding requirement for sophisticated retirement and later-life financial advice.<\/p>\n The opportunity may lie in combining the two: using technology to improve the efficiency and accessibility of advice while retaining the human judgement and personal relationships required to help Australians navigate increasingly long and financially complex retirements.<\/p>\n Elsewhere in the report, the five major transitions identified by the Government as what it expects to influence Australia through to 2065\u201366 are:<\/p>\n Click the cover image below to access the Government’s Intergenerational Report 2026:<\/p>\n\n
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