how to choose a financial adviser

Written by Glen James
Podcast host, author and former financial adviser

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How do you choose a financial adviser? Here are some tips to help you find the right adviser for you!

Knowing how to choose a financial adviser can feel a bit overwhelming, especially if you’re not from the personal finance world. Knowing who to seek out, and who will be suited to the goals you’re hoping to achieve, is confusing! And does everyone need to see a financial adviser? To be totally honest, no. But if you have a number of goals you’d like to achieve, and seeking the support of a qualified third-party would help you, then you’d gain value from a financial adviser. There’s a lot of misunderstanding out there about what a financial adviser does, when you need to see one and how much it costs. Let’s bring some clarity! 

If you would like to be connected to a financial adviser to chat through your situation, reach out here.

Here’s a 3-part podcast series chatting about financial advise and how it works:

when do you know if you need to see a financial adviser?

Seeing an adviser is a great way to plan out the key milestones in your life. If you’re after some foundational things like sorting out your spending we’d suggest checking out other avenues before an adviser – like the Glen James Spending Plan. But when thinking through specific big life things like insurance advice (being prepared for the unexpected), getting an inheritance (what do you do with all that cash), or some accountability for your financial goals (investments across things like shares, property, investment bonds etc) a financial adviser can be a really helpful person to chat with.

Not everyone needs a financial adviser, but everyone needs a financial plan. So before you seek a financial adviser grab and pen and paper and think through what you want in the short and long term – where are you now, what’s the ideal future for you and how you might like to achieve that. This info is where a good financial adviser will start in their chats with you.

Be prepared to have an initial meeting with an adviser to have a broader over-arching chat about where your personal finances are at, and where you might like to take things. Also know that an adviser may take a look at your situation and see that you’re already well on track! In that case they may suggest sticking to your current plan, and returning in a few years when you need more complex guidance.

where do you go to find a financial adviser?

Being referred to an adviser through a trusted source is a great place to start.

You can start by asking friends and family who they’ve used and if they were happy with them, then Google them and read their reviews. Check out websites like adviser ratings to see how they stack up. Another option is to get in touch with us at money money money - if you would like to be connected to a financial adviser to chat through your situation, reach out here. We have a panel of advisers we know are legit and do good work, so feel free to get in touch and we’ll see how we can help.

Be aware that advisers can specialise in certain types of investments or age groups, so seek out the adviser that’s right for your situation. There’s no point in chatting with an adviser that specialises in retirement planning when you aren’t close to retiring! The benefit of contacting our team is we can do a general triage of your goals and align you with the best adviser to suit. The information we ask for is quite general, but gives us an idea of who aligns with what you need.

how do you know if the financial adviser is the right fit?

It’s important you feel comfortable with the adviser you choose – it’s especially important that they listen to you and are on the same wavelength. You’ll know whether this is happening if they ask more questions about you and your goals than telling you about themselves. You need to feel confident that they get you on a human level – there has to be a connection. Also check out that they help other people like you (i.e. only focus on pre-retirees, millennials, teachers etc). You’ll know when you’ve found the right person if you feel a connection with them.

how do you know if they are legitimate?

Generally if they are recommended to you by a trusted source, you'll be fine. You can also search the financial adviser register with their name to see how long they have been an adviser and if they have been banned. Also do a basic check on Google reviews. Following reforms like the Future of Financial Advice (FOFA) reforms, the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, required education standards - it would be a rare exception that you’d be ripped off. There are so many eyes watching financial advisers now. Find an adviser through a trusted source, check them out and you’re on your way.

what does it cost to see a financial adviser?

This holds a lot of people back – uncertainty around the cost of good financial advice. No one should work for free (you don’t, right?) – the cost will generally be in the thousands (depending on the complexity of time and research needed to achieve your goals). But good advice should pay for itself and with the right guidance you’ll be doing better on the other side.

It also depends on your needs and the kind of advice you’re looking for (inheritance vs insurance vs shares etc). Ask up front how the adviser receives payment and make sure you understand what kind of advice you need, what they offer and their suggestions. It’s important that the adviser is the right fit for you so you get maximum value from your chats and the final plans put in place. Make sure you understand everything and don’t be afraid to ask questions about it all – if they’re not willing to answer your questions, they might not be the right fit for you.

what should someone expect at the first meeting?

The first meeting should only be about you and your goals. Jot down your questions before you meet and ask lots of questions - no question is off limits. You should expect no pressure to proceed with anything – the "salesy" parts of this industry are really not there anymore. Ensure you receive their financial services guide before the first meeting or at the first meeting – this details their licence to give advice. Remember you should feel comfortable about everything – you should receive a bunch of info, ask and be asked a bunch of questions and they should be on call for you if you have any concerns.

if I don’t need to see a financial adviser yet, what should I focus on with my finances?

If seeing a financial adviser is something you don’t need just yet, there are many personal finance principles you can be living out to keep your finances in check. It’s all of the things we talk about on my millennial money! All the simple things like:

• spending less than you earn

• investing for your future, even a small amount

• avoiding consumer debts like credit cards, buy-now-pay-later schemes, personal loans

• spending mindfully and in line with your values

• keeping your expenses down

In doing these things you’ll be well on your way to healthy personal finances, and growing your wealth!

connect with the community

Sometimes members of our m3 community ask questions that are really detailed, and genuinely can’t be answered in a Facebook group or on the money money money podcast. It is times like that a financial adviser is worth it’s weight in gold. In the same way you book a certified plumber or electrician, there are times when a certified financial adviser is the perfect fit for your needs. Financial advise received now could set up your wealth creation for the rest of your life. Don’t be afraid – reach out!