At different life stages, most of us need to meet with a professional. It may be a doctor or specialist to discuss our health; a lawyer for legal needs that may arise; insurance brokers to protect assets, or a financial adviser to assist with our strategy and provide advice on wealth protection and creation options.
Choosing ‘the right one’ for you can be tricky. Often we turn to family and friends to find who they’ve been happy with and word of mouth referrals are one of the best ways people find what they’re looking for.
But if your goals are very different to those of your friends, family and colleagues, the referral may not be the best one for you.
If your interest is specifically in relation to Self-Managed Super Funds, and the adviser is a risk specialist who is brilliant at insurance strategy, then it won’t be an alignment for you. Being very clear on your goals can help start the process. What do you want to achieve? How much are you prepared to spend? Is it necessary for the adviser to be local? Are you happy dealing over the phone or by Skype with an adviser who is interstate, but a specialist in what you need?
Most industry associations offer a ‘Find an Adviser’ service on their websites. In Australia, the three main associations are the Financial Planning Association, the Association of Financial Advisers and the Self Managed Superannuation Fund Association. Some advisers are a member of one of these associations, others two, or even all three.
The benefits of choosing an adviser that belongs to a professional association are threefold: Most require their members to keep up annual ongoing training of thirty to forty hours to remain relevant and up to date, members must follow a Code of Conduct or Code of Ethics; and there’s often a complaints handling mechanism that clients can avail themselves of.
If by this stage you’ve got yourself a shortlist of advisers, the Australian Securities and Investment Commission (ASIC) also have a site where you can check on your advisers’ qualifications, history, areas of advice they can provide, whether they’ve had any disciplinary action taken against them, who they are licensed through and which professional bodies they are a member of. Unlicensed advisers are breaking the law and operating illegally, and you will have little to no recourse if things go wrong.
Remember, this is a pretty intimate relationship you’re looking at starting. You are going to be trusting this person with vital personal information and working with them to achieve your financial goals. It’s likely to be a long-term engagement, and you want to be comfortable knowing you’re in safe hands. Therefore, it’s worth doing a little research to find out just exactly who you’re going to be trusting with your finances.
Most advisers also have a LinkedIn profile or a website that will give you further information about their history, along with client testimonials and likely their Financial Services Guide and Adviser Profile. This document lets you know your advisers’ qualifications, how they charge, who owns the company they work for, if there’s any affiliations and their licence number. If it’s not publicly available, write to the adviser’s firm and ask to receive a copy. If you want an adviser who can advise on Self-Managed Superannuation funds and shares, this is the sort of information you can locate in their Financial Services Guide.
Qualifications and experience of an adviser will give an indication of how committed they are to their profession and whether they have experience relevant to help you. Naturally, a degree-qualified adviser is more highly qualified than one with a basic diploma, but years of experience count too.
Fees are often an area of great concern and although most advisers can’t give you an exact figure unless they have a good overview of your circumstances, they can usually give you a ‘ballpark cost’ of what different services would be.
Be diligent in doing your research and clear about what you want to receive from a planner. Even when you’ve got a shortlist, interview two-to-three advisers to see who you’d be most comfortable with. This is an important relationship and one to get right. Although you can change down the track if you feel your needs aren’t being met, it’s worth doing some ‘leg work’ first.
Social media and the internet now make it easier than ever to get to know someone before you meet. Do they offer videos on their website or YouTube? Do they have a presence on other forms of social media where you can get an idea of the kind of adviser they are and what they offer? Have they obtained any industry awards from associations or their peers that set them apart?
A new Australian website even allows clients to write testimonials for their advisers so you can see how they rate. Check out Adviser Ratings to see how those on your list have been rated. It’s still a little new, so may be unknown to many.
You need to be confident that the adviser you choose has the experience and expertise to guide you to meet your goals and that they have the knowledge that you’re prepared to pay for. Take the time to make it a meaningful relationship.