The First Step: deciding to engage a financial planner
Congratulations on taking the first step in securing your financial future.
Working with a financial planner isn’t just about making financial decisions. In our view a good financial planner will help you define and document your goals and provide a roadmap for your financial future. Financial planners should understand your objectives and work with you to ensure you achieve them.
Along the way a good financial planners objective is to provide you with the clarity, confidence and knowledge required to ensure you’re aware of your financial situation at all times, removing the stress and anxiety from the equation and allowing you to focus on what’s important to you. Of course they should also be on hand to ensure you take advantage of any financial strategies that arise from a change in circumstances or legislation.
How to identify a good financial planner
Qualifications and Experience
Education in the financial planning industry varies greatly, from a junior financial planner who has completed their HSC and a Diploma of Financial Planning to a Certified Financial Planner (CFP) who have completed a relevant university degree combined with the CFP programme via the Financial Planning Association (FPA).
A CFP is internationally recognised for having the highest education and ethical standards in Financial Planning.
Check to ensure your financial planner has at minimum a diploma from an accredited institution combined with several years of relevant experience in the field that is relevant to your requirements.
You can also check the ASIC Financial Advisers Register for the above details here: ASIC’s Money Smart
At Satori Advisory all of our Senior financial planners are certified financial planners with a minimum of 5 years experience. They are also members of the Financial Planning Association (FPA). We will continue this tradition to ensure our clients have access to the most qualified staff in the industry.
Ask the right questions
1. How is the financial Planner remunerated?
Financial planners are legally obligated to disclose all forms of payments and fees. When you are looking for a financial planner it’s important to understand how they are remunerated. Fees can be made in many forms:
• A dollar fee that is paid by you directly
• Percentage or dollar based fees deducted from your product or investment
• Fees deducted from your Superannuation
• Payments from third party product providers based on volumes of business placed
• Commissions or incentives from product providers.
This conversation is crucial for ongoing fees as well as initial. Don’t fall into a ‘set and forget’ strategy, where an financial planner continues to receive payments where little or no ongoing service is provided. You need to have a good understanding of the fees you are paying and the service you receive.
Each financial planner should provide you with their Financial Services Guide (FSG), which should outline how they are paid, how they are licenced and what they are able to provide advice on. We recommend that you review and discuss this document in detail with the financial planner. Don’t get lost in the detail – important conflicts should be outlined within this document.
2. What financial products are available to the adviser?
Understand what financial products are available to your financial planner. In some cases they may be restricted and it’s important to understand any limitations and whether or not the available products are suitable for you.
3. How does the financial planner keep their knowledge current?
For financial planners it’s critical to keep up to date on a wide variety of issues that may impact existing and future clients including investment markets, legislation, taxation issues and industry trends. Financial planners should participate in courses, seminars and ongoing professional development activities to ensure the advice they provide their clients takes into account the most recent information.
At Satori Advisory we ensure those staff who are authorised to provide advice complete a minimum of 60 hours education each year. We also ensure they attend seminars, workshops and webinars provided by external third parties. Tracking completion and auditing progress is completed by an independent third party provider. We also have a collaborative workshop each month that’s designed to provide all staff with an update on financial strategies, products and market performance.
4. Question the advice you receive
When you have a decision to make (financial or not), you should always understand:
• What are the benefits of a particular strategy;
• What are the risks involved?
• What are the alternate options available to you, and why has the financial planner chosen this recommendation over the alternatives?
• What the long-term impact of this decision is on your overall objectives?
Leverage their network
Financial planners do not have the qualifications, skills or experience to provide a solution for every requirement. A good financial planner will have built a network of skilled professionals to assist his or her clients with ancillary services such as:
• Estate planning (Wills, Powers of Attorney)
• Accounting services (SMSF and Trust Tax Compliance)
• Taxation Advice
• Mortgage Broking
• Investment Property services
Ensure your future adviser can bring all services together and provide you with a holistic solution that ticks all the boxes. Most importantly ensure that he or she can provide you with solutions that meet your objectives and yours only!
If you’d like further information or if you’d like to meet a Financial Planner at Satori Advisory please contact our team directly on 1300 925 081 or via our contact form.
