If you want to know how to choose a financial planner you can trust, then you’re in the right place.
There are 3 easy steps for choosing a financial planner in Australia.
Step 1 – What Type Of Advice Do You Need?
Financial planners specialise in different types of advice. Some provide advice for retirement planning; some provide advice for investments, while others insurance.
It is necessary to choose a financial planner who’s specialised in the type of advice you need.
The most common areas of specialisation are:
* Insurance Advice
* Wealth accumulation, debt reduction and budgeting
* Retirement Advice & Pre-Retirement Planning
* Self-Managed Super Funds
Financial advisers may have experience in all of these specialisations but they may only be proficient in one or two. It is essential to choose a financial planner who specialises in the type of advice you need as each specialist area has its own unique rules, legislation and strategies.
Step 2 – 5 Different Way To Choose A Financial Planner
Once you know the sort of advice you need, the next thing to do is to start creating a short-list of financial advisers who provide the advice you require. There are many ways to find a financial planner. In this article we’ll discuss 5 different ways to choose a financial planner.
1. Ask Your Existing Service Providers
2. Ask A Friend
3. Contact Professional Associations
4. Conduct A Specific Search Engine Search
5. Use The Find A Financial Planner Matching Service
Let’s discuss these options further.
1. Existing Service Providers
Your current service provider may be able to help you chose a financial adviser, this may be an accountant, a finance broker or a general insurance consultant. Inform them of the type of advice you require so that you can be referred to a specialist financial adviser.
It is not uncommon for finance companies to own financial products and so the downside of taking this approach is that you may be referred to one of their internal planner who may only recommend the companies products. The referrer may receive a referral fee for connecting you and your financial adviser, be wary of this. The referral may not be in your best interest.
2. Ask A Friend
Friends or family members who have received financial advice in the past are another potential referral source. Find out if they were satisfied with the level of service and ongoing support they receive.
Keep in mind that not all financial advisers specialise in all types of advice, so if it is insurance advice you are after it may not be sensible to ask a retiree for a referral to see their retirement adviser, and so on.
3. Contact Professional Organisations
There are several professional associations who can assist you to find a financial planner from their member database.
* Association of Independent Financial Advisers
* Australian Financial Advisers Association (AFA)
* Financial Planning Client Advocate
* Financial Planning Association (FPA)
Obviously, professional organisation will only refer you to a financial planner who is part of their member base.
4. Specific Google Search
You could conduct a specific internet search. Make sure your search includes the advice type and a location, for example, “Retirement Advice Melbourne.” The biggest risk with this method is that there is no third party recommendation, as with all the other methods mentioned in this article.
5. Use Our Online Matching Service
The Financial Planning Client Advocate offers free matching service called “Find A Financial Planner” on their website www.findafinancialplanner.com.au. The service matches you with a financial planner based on your location and the sort of advice you need, which means you will be matched with a specialist financial planner for your advice needs.
To your benefit, all financial planers using the matching service need to pass an accreditation by the Financial Planning Client Advocate (FPCA) before they can be listed, this gives you the added security needed whilst selecting a credible financial adviser.
Step 3 – Question To Ask Your Financial Planner
If you search for a financial planner on Find A Financial Planner matching service then the FPCA has already pre-qualified the financial planner as part of their accreditation process.
If you choose to go it alone, the following are some tips to help you qualify the financial planner you choose.
1. Make Sure The Hold A License – Australian financial planners must hold, or be employed by an Australian Financial Services (AFS) licence to provide financial advice.
2. Request A Financial Services Guide (FSG) – A Financial Service Guide (FSG) outlines the services offered, fees involved and what to do in the unfortunate event of a complaints. Obtaining a copy of the FSG which will help you assess a financial planner.
3. What Are The Fees & How Are They Charged? – Ensure that you are fully aware of all fees and how you will be charged before you precede wit any advice.
4. Who’s Behind The Advice and Why? – An adviser may be limited to recommending companies products as many financial planning firms are owned by or licensed by financial institutes. These institutions may be banks, life insurance companies and fund managers. Recognising who is behind the advice that you receive will help you identify any possible conflicts.
If you want to learn more about choosing a financial adviser then visit the Financial Planning Client Advocate (FPCA) where you can also find a financial planner who a match for your advice needs.