There is a large pool of financial advisers in Australia to choose from. Financial advisers charge for the services they render in different ways. Some receive commissions on the products they sell, other charge a percentage on the assets they are looking after while others charge clients on an hourly basis.

Steps to Follow When Choosing a Financial Adviser

You should first request for the Financial Services Guide. All licensed financial advisers must produce and provide one. You should then perform a check on the owner of the business. Ownership of the business affects the services and products offered. 75% of planners are owned by banks and insurance companies. In some advisory businesses, planners are only allowed to offer the parent company’s products. You should then check whether or not the services offered cover your needs. Some advisory firms are restricted in their product and service offerings. Thereafter, you should arrange a meeting with the adviser. The meeting is an opportunity to evaluate the suitability of the financial adviser to you. You should then make a decision after comparing the adviser and not comparing their advice.

Questions to Ask When Choosing a Financial Adviser

There are certain questions that you need to ask your prospective financial adviser when meeting him or her. These questions touch on their experience, their empathy, their qualification, their fees and their professionalism. The ideal financial adviser should be someone with experience in successfully advising people like you, someone who puts your needs first, someone qualified to advise you, someone who charges reasonable fees and someone who upholds high professional standards.

How Long Have You Been Giving Advice?

This question touches on the experience of the financial adviser. The more the experience of the financial adviser, the more suitable he or she is.

What Area of Financial Advice Do You Specialize In?

This question touches on the experience the financial adviser has in a specialized area. You should opt for financial advisers who specialize in areas that concern you such as taxation, superannuation and retirement.

What Kind of Clients Do You Mostly See?

This is another question touching on experience. The ideal financial adviser should be one who sees clients with similar concerns to yours.

Are There Any Financial Products That You Don’t Advise On?

This question indirectly touches on his experience. Financial advisers who don’t advise on financial products that affect you should not be engaged.

How Do You Gain An Understanding of A New Client?

The ideal financial adviser is the one who seeks to get a full picture of your circumstances and needs. He or she will ask you a lot of questions in a bid to do just that. He or she will probably request a separate appointment to fully understand you.

How Do You Deal With A Client Who May Have Conflicting Financial Objectives?

The ideal financial adviser will explain and discuss the choices with you. He or she may subsequently conduct a research and prepare advice for you to take away and consider.

How Do You Choose The Investments You Recommend?

When all is said and done, you are looking for a personalized investment plan that meets your specific needs. The ideal financial adviser should have an independent approach towards recommending investment products.

What Qualifications Do You Have?

This is a question that touches on their professional competence and due care. You are looking for a financial adviser with qualifications in finance, economics, accounting or financial planning.

How Much Is The Advice Likely To Cost?

Most, if not all financial advisers have a strong financial motive. The ideal financial adviser should offer a clear explanation of his or her fees and commissions. Moreover, he or she should offer a general explanation about any likely product fees.

How Do You Keep Up To Date With Industry Standards and News?

To have and maintain high professional standards, a financial adviser should not only have the professional qualification but have a clear line of continuous professional development. The ideal financial adviser should therefore be one who attends courses and training programs run by universities, Finsia or FPA. He or she should also be a member of FPA, stockbrokers’ professional body or Finsia, just to mention a few professional bodies.

You now know what you need from a financial adviser. With that in mind, the questions above do not necessarily have to be asked word for word. Choosing a great financial adviser is one of the decisions in your life to give utmost importance.

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