The below is an edited excerpt from a speech by CEO Francesco De Ferrari to the Morningstar Individual Investor Conference in Sydney.

“I find it very interesting that when I hear people talk about wealth normally, they talk about superannuation and how you’re investing that piece of your wealth for your retirement. Actually, that is not the real question.

It’s very hard to talk about retirement and talk about super. Superannuation is only 18% of your money, on average, in Australia. Australians love their real estate and so 60% of wealth in Australia is invested in bricks and mortar. There is very little savings outside of superannuation. This is driven by a number of the tax laws and is very rational behaviour.

Most of the people listening to me today have probably made more money in real estate, after tax, than they would from their jobs. And this is not the first country where this is the main lever that the government has had to pull to create wealth.

The focus on super isn’t enough. You really have to look at the overall picture and where, effectively, does advice help. For the average Australian, earning $80,000 a year, I’m not sure you want to start with super.

You want to start with how you balance the budget; how you save more; how do you deal with all this consumer lending – and new business models that are out there and make it easy to buy stuff when you don’t have the money; how do you build financial discipline; and, the most important decision is – if you look at how the wealth is invested – is what will you do with your home and your mortgage. And only when you tackle this can you get a whole picture as to – is your lifestyle effectively sustainable when you want to retire?

So, that’s one big concept we’re starting to look at, and what are the points in your life when it really matters to get real advice, and where effectively you can do it yourself or you can be supported by technology in doing that.

I think the other critical concept for us as we look at is the concept of modular delivery. If we are honest about making wealth accessible to more Australians, then we have to find a better way to deliver because face-to-face advice alone is very expensive. And – again – with an average salary of $80,000, people will not be able to afford to pay a full-time adviser on a recurring basis.

So, how do we use technology and how do we effectively move toward a more episodic advice? It’s clear to me one size doesn’t fit all, and we need to give clients the opportunity to access advice when and how it suits them. These are the two big challenges that we are dealing with as we look into how we effectively build a world-class wealth model in this country.

So, is there a future to wealth management in Australia? For me – unequivocally – yes. I think this is a huge societal need and getting wealth and financial advice right is absolutely critical especially in the current environment where markets are very tricky, and prices are at an all-time high.

How to navigate this is very complicated. People are living longer and, structurally, a lot of the savings are not there to be able to afford a healthy retirement. This is not a simple transformation.

When I gave my address at our half-year results in August 2019, I said this was going to take – for me – at least three years as we reposition the business. But I really think AMP is willing to invest in addressing some of these issues and I think at the end of this journey it will be really worth it. We need to be very proud of our past because AMP did fantastic things but now, we need to realise we’ve got to start looking at the future with a different lens.”