How to select a financial adviser

How to select a financial adviser

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As a retiree, you want to make the most of your money, which is why many seniors choose to consult a financial advisor to help them understand their options, and work out a plan for the future. With recent changes to the financial planning industry, being well informed about your finances, and who you choose to advise you, has never been so important. A financial adviser can help you with your retirement planning and give you advice about any investments and superannuation. They can also help you make sure you and your family are protected in the event of something unexpected. Finding a good financial adviser can take some effort, and there are a number of factors you may want to take into consideration when choosing the right person to manage your financial future.

Licensing and regulatory bodies

Legally, not just anybody can offer financial advice. Before you engage the services of a financial planner, it is essential that you make sure they are sufficiently qualified to undertake the work.

Your financial planner, or the firm they work for, should hold an Australian Financial Services (AFS) licence, which is issued by the Australian Securities and Investments Commission (ASIC). It is an advantage if they are also members of the Financial Planning Association of Australia (FPA).

The financial advice industry has recently undergone regulatory reform, with strict new compliance requirements to take effect from July 1.

There are a number of changes, including a best interests duty which applies to personal advice given to retail clients, a ban on conflicted remuneration, which applies to both personal and general advice, and financial advisers having to issue a fee disclosure statement to retail clients who are paying ongoing fees for personal advice each year. The statement will outline the fees paid, the services provided and the services the client was entitled to receive. Under the reforms, financial advisers will also need to make sure that these clients sign a new advice agreement every two years.

Choosing the right advisor for retirement planning

Different life stages come with different challenges, so choose a financial planner who is experienced and knowledgeable about retirement planning, and can offer you the most up to date advice.

Do you feel comfortable with them?

To get the most out of your financial planning, you need to feel comfortable with your financial adviser. Finances are a personal matter, so make sure you take your time and choose someone you feel relaxed with and trust, but don’t be overly swayed by a pleasant demeanour.

Do they advise on a wide range of products?

Financial advisors who only work with a limited range of products may only be able to provide you with limited advice. Make sure your chosen professional has access to and is knowledgeable about a wide range of products.

Check their fee structure upfront

You don’t want to receive any unexpected bills, so don’t be afraid to ask how your financial planner charges for their services, and how much the costs will be.

Some financial advisors charge a flat rate for certain types of worth, while others work on an ongoing fee basis. It is a good idea to find out exactly how much you will be paying at the start, and what your ongoing costs will be for updating your portfolio and providing future advice.

Managing your money effectively in your retirement can help you enjoy your lifestyle, and give you valuable reassurance that you are getting the most out of your investments. A good financial planner will help you with your retirement planning and your general finances over the years, so it is worth taking the time to find the right person.

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