There are plenty of places offering financial advice. But where do you start? We take you through the main options.
The first place most people go when seeking out anything financial, and this includes advice, is their bank. Most banks will have a wealth management arm or private bank where advisers are licensed to offer financial planning to customers. When going to a bank, you must be aware that you are likely to be sold or advised primarily on that bank’s products. Just like stepping into a McDonald’s store, you will be sold a McDonald’s burger and chips – you won’t get the option to check out Hungry Jack’s.
Huge resources, great research
Product choice limited to bank brands, limited number of advisers
For those fortunate enough to have an accountant, this may be a good starting point when starting to get financial affairs in order. There has been considerable consolidation meaning many accountancy practices are also equipped to offer financial advice. Accountants need to be appropriately licensed to offer you financial advice so make sure they at least have their Australian Financial Services License and the experience.
Usually fixed fees for advice,
Often not financial advice specialists; watch fees on SMSFs
Your Super Fund
A lot of Super Funds have some level of advice that they offer their members. This advice is often around what the fund can offer in terms of investment and insurance options. The advice is general in nature. If you want anything more complicated, then it is worthwhile seeking out a professional adviser. Some super funds have relationships with financial planners they can put you on to.
Cost effective (often free)
Usually basic general advice only
An Advice Association
There are several associations in Australia that look after the interests of financial advisers. The three most prominent associations are the Association of Financial Advisers (AFA), The Financial Planning Association (FPA) and the SMSF Association. They have differing levels of membership depending on the experience and level of qualifications. All advisers that are members abide by the different association’s code of ethics. The Associations also provide a “Find an Adviser” service on their website for customers. The AFA has a Your Best Interests video channel showing real life stories and scenarios to help educate clients.
Advisers abide by association’s code of ethics, easy search functionality
They do not cover the entire marketplace
In March 2015, the Australian Securities and Investments Commission launched its own list of financial advisers. The register houses the entire marketplace of approximately 24,000 financial advisers across Australia. The register lists key attributes of financial advisers, including employment history, specialties, qualifications, years of experience, memberships and whether they have any black marks or previous disqualifications against their name. The list is comprehensive, and has been implemented to help consumers know their adviser’s background.
Covers entire financial advice marketplace
Search functionality limited, difficult to compare
The Adviser Ratings register is the ASIC list with additional benefits. It lists all the components of the ASIC register next to each adviser, such as qualifications, experience and disqualifications – but then rates them to make it easier to compare. It also allows existing or previous customers to review their adviser, like a Tripadvisor of the finance industry. The skills of advisers are also rated by customers to help new customers get matched more appropriately.
Comparisons and consumer reviews makes it easy to choose the right adviser
Not all advisers are on the site yet