New research on how people select advisers finds that many people struggle to tell a good financial adviser from a bad one. They find it hard to tell good advice from bad advice when the issues are more complex. They also tend to stick with an adviser even when the quality of advice is not always good.

The research by Susan Thorp, professor of finance and superannuation at the University of Technology, Sydney, and colleagues, throws light on how well individuals evaluate the quality of the advice they receive and why they stick with bad advisers. The results included people being ''extremely poor'' at distinguishing between real and bogus qualifications.

New research throws light on how well individuals evaluate the quality of the advice they receive.

The research underlines the importance of strong consumer protection and comes as the Coalition government wants to roll back some of Labor's Future of Financial Advice reforms. The reforms resulted from a string of failures that cost retirees their life savings after advisers were influenced by commissions.

The government says its proposed amendments are fine-tuning that will cut red tape and expenses for the firms that employ planners, and make advice cheaper for consumers. Critics say the proposed amendments are more about the government placating the demands of the banks and insurers, to whom the majority of planners are aligned. They say the amendments will weaken consumer protections.