How to choose a financial planner

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How to choose a financial planner

How to choose afinancial plannerHelpful tips on choosinga financial planner


Choose a committed financial planningprofessional who is a member of the FPAAll practising financial planners must be licensed, but it’ssensible to look for one who is also a member ofa professional association – the FPA is the peak body forfinancial planning in Australia. All FPA practising membersare committed to a code of ethics and rules of professionalconduct, over and above what is required by law. Theymust also undertake continuing professional development.Use the FPA’s ‘Find a Planner’ service atwww.fpa.asn.auThis service helps you identify FPA members in your localarea. It includes contact details for over 5,500 CERTIFIEDFINANCIAL PLANNER TM professionals across Australia.Ask a friend for a referralReferrals from friends who have had a good experiencewith a financial planner can be the best and easiest wayto find one that suits your needs. FPA research shows thatover half the people who used a financial planner werereferred by a friend.Talk to a CFP ® professionalCFP certification is the global symbol of excellence infinancial planning. The CFP Mark is awarded to individualswho have gone beyond the competency, ethics andprofessional practice standards required of other FPApractitioner members. Each year CFP professionals mustrenew their right to use the Mark.®, CFP ® and CERTIFIED FINANCIAL PLANNER are certificationmarks owned outside the U.S. by the Financial Planning Standards BoardLtd and used by the FPA under licence.


Look for someone you can trustYou share a lot of confidential information with yourplanner and need to be able to take him or her completelyinto your confidence, and establish a relationship of trust.Your financial planner should be open, well informed,professional and a good listener. Based on the informationyou provide, a planner will produce a Statement of Adviceoutlining your current position and recommending astrategy for achieving your goals.Be preparedPrepare for your first appointment with notes on yourfinancial goals and what you want from your planner.You don’t need to go into too much detail at a firstexploratory meeting, but you should be prepared toprovide your chosen planner with all relevant informationabout your income, debts, what you own, and yourfuture financial expectations.Ask questionsAsk questions about the financial planner’s qualifications,experience, area of specialisation and what they expectto be able to do for you. Also question how they charge(for example, up-front fees, commission, or a combinationof both). See the next section for more on the types ofquestions to ask a planner.Do a bit of background readingIf you feel you need to know a bit more, Money WellSpent is a ‘quick read’ that gives the key facts aboutfinancial advice. Getting Advice is a practical guideto finding the right financial planner and advice thatworks for you. Both publications, and more, can bedownloaded from the FPA website, www.fpa.asn.au,or call freecall 1800 626 393 for free copies.


Ten questions to ask aprospective financial plannerTake your time finding a planner anddo some research. Aim to talk with a fewdifferent planners before you decide on one.If you’ve followed our tips, then you would have madesure that your prospective planner is a member of the FPA,and perhaps even a CFP professional. Whenever you talkwith a prospective financial planner, it’s good to ask lots ofquestions. We’ve put together a list of 10 specific questionsto use when interviewing a planner.1Can I see your Financial Services Guide?The Financial Services Guide (FSG) explains the natureof the financial services being offered, the fees andcommissions charged and how the person providingthe service deals with customer complaints. A financialplanner is required by law to give a client a FSG beforeproviding any financial advice.2How long have you been a financial planner?The more experience the better. If the planner has lessthan two years experience, ask if someone else within thefinancial planning business would take a look at the adviceas well.3What do you specialise in?Some planners specialise in certain areas – retirementplanning, high net worth planning and so on. You shouldalso ask if the planner will implement the plan or refer it tosomeone else.


9Who authorises you to give advice and areyou licensed by ASIC?Ownership of your financial planner’s business can influencethe services and products you’re offered. Many advisorybusinesses are owned by major financial institutions likebanks, fund managers and life insurance companies. Evenif they operate under a different name, the FSG will tellyou if they’re owned or associated with other companies.Other financial advisory businesses are independentlyowned. Both work under the same legal requirements togive appropriate advice to their clients. In fact, by law, anyperson or company that provides personal financial adviceis required to have an Australian Financial Services Licence(AFSL) issued by ASIC or be authorised by a licensee.10How does the planner keep up-to-date witheverything that’s happening?If you’re talking to an FPA member, then you will alreadyknow that they are committed to high professionalstandards and a code of ethics. But it’s a good idea tohear how a planner keeps abreast of issues throughcourses and training run by universities, associations andother professional bodies.


You can find out more about financialadvice by contacting the FinancialPlanning Association on 1800 626 393or visiting the website at www.fpa.asn.au

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