General Information, General Advice and Personal Advice: What’s the Difference?

By Katrina Pulbrook, Executive Planner, RJS Wealth Management

Financial information has never been easier to access.

You can search a question online, watch a video, listen to a podcast or use an artificial intelligence platform to explain a financial concept within seconds.

That access can be useful. It can help you understand the language, compare broad options and prepare better questions.

But there is an important difference between receiving information about money and receiving advice about what may be suitable for you.

The difference comes down to context.

Your income, family, debt, superannuation, tax position, business interests, goals and stage of life all affect the financial decisions available to you. A strategy that appears suitable in an article may produce a very different result once those factors are considered.

That is why it helps to understand the difference between financial information, general advice and personal advice.

What is financial information?

Financial information explains facts, concepts, rules or features without recommending that you take a particular course of action.

It might explain:

• how superannuation works
• the difference between shares and managed funds
• how compound returns are calculated
• what income protection insurance is
• the broad features of a self-managed superannuation fund
• common considerations when preparing for retirement

Information can build knowledge. It can help you become more familiar with your options and more confident asking questions.

It does not assess whether a product or strategy suits your circumstances.

ASIC's guidance distinguishes factual information from financial product advice. Moneysmart also describes financial information as facts about financial products, services and strategies rather than a recommendation about what a person should do.

What is general advice?

General advice goes a step beyond factual information.

It may include a recommendation or opinion about a financial product or strategy, but it does not consider your objectives, financial situation or needs.

You may hear general advice during a presentation, webinar or product discussion. You may also come across it in educational content published by a financial services business.

General advice can help you identify options worth investigating. What it cannot do is determine whether an option is suitable for you.

Moneysmart defines general advice as a recommendation or opinion about a financial product that has not been tailored to the recipient's personal circumstances.

That distinction matters.

Two people may be the same age and earn the same income but require very different financial strategies.

One may have children, a mortgage and limited savings. The other may own a business, hold several investments and be supporting ageing parents.

The same general strategy should not automatically be applied to both.

What is personal financial advice?

Personal advice considers your objectives, financial situation and needs.

Rather than asking only, "How does this strategy work?", personal advice asks:

• What are you trying to achieve?
• What assets and debts do you currently hold?
• How stable is your income?
• What financial responsibilities do you have?
• What risks can you reasonably accept?
• What tax, superannuation or structural issues need to be considered?
• What may change over the next few years?
• How could one decision affect the rest of your financial position?

When personal advice is provided to a retail client, the adviser must act in the client's best interests, provide appropriate advice and prioritise the client's interests.

The adviser must also be appropriately licensed or authorised to provide the relevant financial advice.

This professional responsibility is one of the main differences between personalised advice and information gathered from informal sources.

Why information alone may not answer your question

Most financial questions do not sit neatly in one category.

Consider the question:

Should I contribute more to superannuation or reduce my mortgage?

General information can explain the potential benefits of both options.

It can explain contribution rules, tax treatment, interest costs and access restrictions.

What it cannot determine is which approach may suit you.

That would depend on matters such as:

• your age and intended retirement date
• your mortgage balance and interest rate
• your available cash flow
• your marginal tax rate
• your current superannuation balance
• contribution limits
• your need to access the money before retirement
• other debts or upcoming expenses
• your broader goals

The question is not simply whether contributing to superannuation is a good idea or whether reducing debt is a good idea.

The real question is how each option fits into your complete financial position.

Search engines and AI can explain. They cannot know you.

Digital tools can be helpful when you are researching a topic or trying to understand financial terminology.

They may help you organise questions, compare definitions or learn how a financial strategy generally works.

They do not hold an Australian Financial Services licence, and they do not have the professional obligations that apply when licensed personal financial advice is provided.

As Moneysmart explains, only an appropriately licensed provider can give personal advice about what is suitable for your circumstances — general digital tools are not licensed to do so.

There is also information that a search tool may not know unless you recognise that it matters and provide it.

That might include:

• an expected inheritance
• an upcoming career break
• a business sale
• an old insurance policy
• a previous relationship or blended family
• an employee share scheme
• a health concern
• competing financial goals between partners

Personal advice is built through a conversation. The adviser asks questions, tests assumptions and identifies connections that may not be obvious when each financial issue is considered separately.

When might personal advice be worth considering?

There is no single point at which everyone needs financial advice.

A conversation may be worth considering when:

• you are approaching retirement
• your income has increased but your wealth has not
• you are unsure whether your superannuation is on track
• you have received or expect to receive an inheritance
• you are starting, growing or selling a business
• you are separating or entering a new relationship
• your family structure has changed
• you have several financial decisions that affect each other
• you understand your options but remain unsure what to do
• you have repeatedly placed a financial question in the "too hard basket"

You do not need to wait until every document is organised or every question has been answered.

The first conversation can be used to understand where you are, what matters most and whether advice would be useful.

Information is the starting point. Application is the difference.

Good financial information helps you understand the possibilities.

Personal advice helps you assess those possibilities against your own circumstances.

Both have a place.

The mistake is assuming that information written for a broad audience automatically provides the answer for an individual.

Your financial position is shaped by more than one account, product or decision. It is shaped by how your cash flow, debt, superannuation, investments, protection, family responsibilities and plans work together.

That is where personal advice becomes valuable.

It turns "What could someone do?" into a more relevant question:

"What should I consider, given where I am and what I want my money to support?"