Questions to Ask A Financial Planner

When it comes to engaging a professional to help you plan and prepare for your future, you want to know that you are getting what you pay for. It is also nice to know that the financial planner you are working with is qualified and has experience under their belt. What questions can you ask a financial planner to find out if you have someone you can work with towards your financial future? Here are some questions to help you get started with what hopefully will be a successful relationship with your financial advisor:

How Often Will We Meet?

Hopefully the answer to this question will be that your financial advisor will want to have regular meetings based on your selected service level. Meeting regularly, especially at the beginning of your working relationship, will ensure your financial plan is on track. Once your plan is established, touching base once or twice a year is sufficient. Any changes to your personal situation, priorities, markets, government policy or technology changes may mean that there are new challenges or opportunities that you need to consider and potentially act upon. At the very least, meeting regularly with your financial advisor keeps everyone in check and ensures that you are reminded of your financial goals and what you are working towards for your future. Even with a regular meeting set in place, your planner should be open and accessible, should your needs change unexpectedly.

How Do You Charge for Your Financial Advice?

A common misconception about fees is that there are hidden commissions. Rest assured that commissions were banned for financial planning products in 2014 to improve transparency and the client-adviser relationship. However, it is still important to have a clear conversation with your financial adviser to understand WHAT services you will be receiving and for WHAT fee. This should detail the level of contact and scope of the advice.

A fee for service model is a typical model as it is fair for everyone, you get what you pay for with no hidden surprises along the way. You should expect your advisor to be upfront with this information at the earliest opportunity. There may even be an opportunity in some cases for you to ask if this fee can be debited from your superannuation account.

How Do You Choose What To Recommend To Clients?

Your financial planner will need to spend a bit of time looking into your individual situation and exploring your goals before they choose the products and services to put towards these objectives. Make sure your financial planner takes the time to understand your risk tolerance, financial situation, goals for retirement and any challenges (medical, family situation etc) that may affect you financially along the way. Finding a financial planner that takes the time to work these things out with you is crucial to getting the most out of your advice. After you spend time asking your financial planner good questions, allow them to ask you some good ones too, to establish a good working relationship and trust that leads to success.

Are You a Member Of Any Industry Or Professional Body?

Choosing a financial advisor that is a member of the Financial Planning Association ensures that you are trusting someone who is held accountable to a strict code of ethics and professional conduct. The bar is set high with Financial Planning Association (FPA) and high standards are laid out, higher even than those that are put in place in the usual financial planning regulations. If your planner is not associated with any industry or professional bodies, this may be a red flag. You may want to ask why he or she does not feel the need for accountability.

Can I Get a Second Opinion?

You may have already met with a financial planner and felt that their advice was not quite right for your situation. You need to be comfortable with the advice you are given. So, whether more information is necessary, or a completely different strategy is required for your financial goals, it is completely fine to get a second opinion. It is worth saying though, once you have found an advisor that you feel understands where you are at, and you have built a good relationship, it is a good idea to stick with the professional that you feel adds value to your financial future.

Where Do We Meet?

It may not seem necessarily make or break to a relationship, but the logistics of where to meet are quite important. You need to be sure that you can meet somewhere that is relatively local to you and have some flexibility when and how that looks. We have all lived through the past two years of COVID disruption and know what it feels like to have plans dashed. Ensure your planner has the technology and flexibility to meet online if necessary. It all ties in with being able to get together regularly and have touchpoints along the way, to ensure your plans are well in check.

What Services Do You Provide?

Your financial planner should be well rounded enough to help you with most aspects of your financial life. This would generally include:

• Superannuation
• Personal Insurance
• Wealth Creation
• Wealth Management
• Investment Planning
• Borrowing to Invest
• Self-Managed Superannuation Funds
• Budgeting and Cash Flow Management
• Debt Management
• Estate Planning
• Property Strategy
• Aged Care

All this to say, a financial planner does not need to be able to provide you with a home loan or do your taxes. That is where they should use their trusted network of professionals and stick to what they are qualified to do.

Knowing you have found a good financial planner can really come down to asking the right questions. You are well within your rights to ensure you have found someone that treats your financial future with utmost care and diligence, is an ‘open book’ and can help motivate and empower you to take control of your financial future.

For more information get in contact with Elliot Watson Financial Planning on 02 4038 1623.

The information within, including tax, does not consider your personal circumstances and is general advice only. It has been prepared without taking into account any of your individual objectives, financial solutions or needs. Before acting on this information you should consider its appropriateness, having regard to your own objectives, financial situation and needs. You should read the relevant Product Disclosure Statements and seek personal advice from a qualified financial adviser. The views expressed in this publication are solely those of the author; they are not reflective or indicative of licensee’s position and are not to be attributed to the licensee. They cannot be reproduced in any form without the express written consent of the author. Elliot Watson Financial Planning Pty Ltd ABN 70 610 168 646 is a Corporate Authorised Representative of RI Advice Group Pty Ltd, ABN 23 001 774 125 AFSL 238429. Photo by Sora Shimazaki from Pexels