Opportunities for Serving the Mass Affluent Market in Financial Advice
Opportunities for Serving the Mass Affluent Market in Financial Advice
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Charlie Viola, executive chairman of Viola Private Wealth, recently highlighted a promising opportunity for financial institutions to better serve the mass affluent market.
Despite the recent trends stemming from the royal commission that have seen personnel changes across the financial advisory sector, Viola asserts that there remains a strong clientele base.
The financial advisory business, he notes, benefits from a steady stream of increasingly wealthy individuals, but the challenge lies in effectively serving those with moderate wealth.
The crux of the issue, as Viola sees it, is that most advisors covet high-net-worth clients, typically those with $2 million to $200 million in assets. The commercial realities—compliance, governance, and operating costs—make it tough for financial advisors to cater to clients with assets in the range of $300,000 to $500,000, thereby opening a gap in the market.
Viola suggests that industry super funds and large institutions have a unique opportunity to address the needs of this mass affluent segment effectively. These clients often require guidance on diverse financial planning aspects, including mortgage payments, insurance, and superannuation contributions.
The Australian government's ongoing Delivering Better Financial Outcomes (DBFO) reforms aim to widen the scope of financial advice that super funds and institutions can provide. These reforms, however, have experienced delays, with Financial Services Minister Daniel Mulino prioritising their advancement. Acknowledging the complexities involved, Mulino emphasises the need for careful consideration and consensus-building across the sector.
Among the criticisms of the reforms are concerns from the Financial Advice Association Australia related to the scale and clarity of charges, as well as questions about the qualifications required to deliver this level of advice within a super fund.
Viola stresses the importance of applying adequate resources and regulations to ensure effective service delivery to this market segment. The goal is to offer beneficial advice covering debt reduction, wealth growth, and insurance, ultimately preparing clients for more sophisticated investment opportunities when they are ready.
For those with superannuation between $300,000 and $500,000, Viola acknowledges the benefits of remaining in regulated, professionally managed super funds that offer diverse investments without excessive fees. He believes such institutions are well-positioned to manage these accounts, providing stability and growth opportunities until individual clients aspire for more personalised financial pathways.
Published:Tuesday, 12th Aug 2025 Source: Paige Estritori
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Knowledgebase
Index Fund: A type of mutual fund designed to replicate the performance of a specific market index, such as the S&P 500.
