When it comes to getting financial advice, it’s all about trust; you have to be confident that whoever’s helping you handle your money does have your best interests at heart.
There’s been some shakeup in the Aussie financial industry, thanks to recent findings from the financial services royal commission, which has made it hard for people to turn to a financial adviser in Australia, which is an issue for both sides. The Productivity Commission reports that about half of all Aussie adults have unmet financial advice needs.
Here are some advice to help you find the right adviser for you.
Know what you’re looking for
First off, what the hell does a financial planner actually do?
Financial Planning Association of Australia CEO Dante De Gori explains that, in simplest terms, a financial planner helps you achieve your financial goals, letting you live the life you want to live. He adds that a financial planner can help with any financial issue at any life stage, from buying a house, to superannuation, or just simple budgeting.
Professor Gail Pearson, an academic of consumer law and financial services at the University of Sydney, notes that certain areas are in greater need of a financial adviser in Australia compared to others, like retirement, superannuation, and other investments, particularly those involving a considerable amount of money, and, for most people, the amount of money that they have doesn’t really warrant a financial adviser.
How to choose?
Laura Higgins, Australian Securities and Investments Commission, says that having a financial adviser in Australia is akin to a relationship; you need to know who you’re dealing with, you need to study on the effects on your life, and you need to know why you’re taking this on in the first place.
Recommendations and referrals from friends are a good place to start, which should be followed up with checks on ASIC’s registry, and licence verification.
De Gori recommends meeting potential advisers face to face, and openly inquiring about their process. He recommends that consumers not hesitate when it comes to asking questions on their mind.
How much do I pay?
Financial advisers have different pay models; some might charge you upfront, others might charge you a percentage of the assets they’re managing. The FPA states that the average upfront cost for receiving advice sits at around $2,500, or $3,500 per annum, if you’re in an ongoing relationship with the adviser.