Wednesday, November 10, 2010

INVESTING IN GOOD ADVICE

Most people think of retirement when they think of a Financial Adviser and while planning for your future is important an experienced and qualified Financial Adviser can help you save money, protect against risk, manage debts, grow wealth, reduce tax and even help with your legacy.



A financial adviser’s first responsibility is to you, the client, not an employer, a product provider or to him/herself but to the needs and objectives of the client.

When providing advice an adviser must take into account the individual circumstances of the client. A client’s needs and objectives are as individual as their finger prints and no two clients will ever be the same so it is important for your adviser to spend time getting to know you and what your needs and goals are.

There are two types of advice, General Advice and Personal Financial Advice.

General advice may help you to make decisions on financial products or money but it does not take any of your personal circumstances into consideration. Personal financial advice on the other hand considers a clients personal needs, objectives, their current situation and any goals the client may have for the future. With all this information the adviser can recommend appropriate strategies specific to these individual circumstances and where necessary recommend financial products.

Most people choose to see a financial adviser at significant turning points in their life. They may need a professional to help them consider their options and to understand financial products, tax laws or the benefit system (centrelink). Once people find an adviser with whom they are comfortable, a long term relationship often develops with regular meetings to review changing needs.

Some of the reasons a person may consult a financial planner include:

• Starting work or changing jobs and looking at superannuation options.

• Getting married, or separating from a partner.

• Starting a family, and saving for education costs.

• Buying a house, or paying off the mortgage.

• Looking to invest for capital growth.

• Planning to retire.

• Inheriting money, receiving redundancy payments or other lump sum payments.

So how do you know if you are getting good advice?

Your financial adviser should be:

• taking into account your personal needs and goals,

• putting your needs first,

• providing clear and understandable advice both verbally and written(statement of advice),

• clearly identifying costs which are openly discussed and explained

• open about any conflicts of interest which may influence the adviser’s recommendations

Financial advice is a valuable professional service. To provide financial advice, a financial adviser must be licensed by the Australian Securities and Investments Commission (ASIC) or be an authorized to represent a license holder.

The ASIC consumer website  allows people to check who holds a licence or is an Authorised RepresentativeClick here for tips on choosing a financial adviser.

Disclaimer: This article is no substitute for financial or investment advice and should not be read as such nor relied upon as such. You should seek your own professional advice tailored to your individual investment objectives, financial situation and particular needs.



Wayne Lennan is an Authorised Representative of Financial Wisdom AFSL No. 231138

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