Handy tips on choosing a financial planner

Many people don’t consider consulting a financial planner until they are close to retirement or if they are being retrenched. However, to reach a reasonable level of financial security, the earlier you start a regular plan of saving and investing, the better.

Specialist advice
While your financial institution will continue handling your regular transactions such as daily savings, term deposits and personal or housing loans, a qualified financial planner will provide specialist advice on strategies and products for wealth creation, superannuation, retirement and investments such as shares, managed funds and property trusts.

Choosing the right financial planner is a crucial component of a successful financial strategy. Some important factors to consider includes:

  • Qualifications
  • Licence
  • Services offered and 
  • Fees

The right qualifications
Some financial planners are originally qualified in accounting, stockbroking or other fields of finance while others may have undertaken specialised training in investment and retirement planning.

To give advice on securities (debentures, shares, bonds and managed funds), planners must either be licensed by the Australian Securities and Investments Commission or be an Authorised Representative of a licensee, who is responsible for their monitoring, training and supervision.

While there are many duties and responsibilities imposed on individual planners by law, policy and industry standards, it is also important that the planner stays up-to-date on industry news which can affect your investment decisions.

The planner should regularly review your investment strategy and portfolio performance.

Disclosure of fees
How financial planners make their money varies. Some do not receive commissions or volume payments but will instead charge a flat fee based on the service you require and agree to.

Your planner should inform you of the fee details before you make your investment decisions and most importantly, you must feel comfortable that the planner’s advice is in line you’re your personal investment needs.